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Performance audit, Department of Public Safety, Licensing Bureau

Performance audit, Department of Public Safety, Licensing Bureau

State of Arizona
Office
of the
Auditor General
PERFORMANCE AUDIT
LICENSING BUREAU
Report to the Arizona Legislature
By Debra K. Davenport
Auditor General
DEPARTMENT
OF
PUBLIC SAFETY
May 2001
Report No. 01-10
The Auditor General is appointed by the Joint Legislative Audit Committee, a bipartisan committee
composed of five senators and five representatives. Her mission is to provide independent and impar-tial
information and specific recommendations to improve the operations of state and local government
entities. To this end, she provides financial audits and accounting services to the state and political
subdivisions and performance audits of state agencies and the programs they administer.
The Joint Legislative Audit Committee
Senator Ken Bennett, Chairman
Representative Roberta L. Voss, Vice-Chairman
Senator Herb Guenther Representative Robert Blendu
Senator Dean Martin Representative Gabrielle Giffords
Senator Tom Smith Representative Barbara Leff
Senator Randall Gnant (ex-officio) Representative James Sedillo
Representative James Weiers (ex-officio)
Audit Staff
Dot Reinhard—Manager
and Contact Person (602) 553-0333
Paula Taylor—Team Leader
Rachel Rowland—Team Member
Heather Payne—Team Member
Copies of the Auditor General’s reports are free.
You may request them by contacting us at:
Office of the Auditor General
2910 N. 44th Street, Suite 410
Phoenix, AZ 85018
(602) 553-0333
Additionally, many of our reports can be found in electronic format at:
www.auditorgen.state.az.us
2910 NORTH 44th STREET • SUITE 410 • PHOENIX, ARIZONA 85018 • (602) 553-0333 • FAX (602) 553-0051
DEBRA K. DAVENPORT, CPA
AUDITOR GENERAL
STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL
WILLIAM THOMSON
DEPUTY AUDITOR GENERAL
May 15, 2001
Members of the Arizona Legislature
The Honorable Jane Dee Hull, Governor
Colonel Dennis Garrett, Director
Department of Public Safety
Transmitted herewith is a report of the Auditor General, A Performance Audit of the
Department of Public Safety’s Licensing Bureau. This report is in response to a June 16,
1999, resolution of the Joint Legislative Audit Committee. The performance audit was
conducted as part of the Sunset review set forth in A.R.S. §41-2951 et seq. I am also
transmitting with this report a copy of the Report Highlights for this audit to provide a
quick summary for your convenience.
This is the fifth in a series of reports to be issued on the Department of Public Safety.
As outlined in its response, the Department of Public Safety agrees with 17 of the 18
recommendations. The Department does not agree with the recommendation that the
Legislature should consider transferring the federally mandated firearm background
clearance check to the FBI. The Department indicates that it is working to obtain access
to additional sources of information, such as mental health records, that the FBI does
not have access to. The Department believes that if it gets access to this additional
information, it will be able to provide better background check services than the FBI.
My staff and I will be pleased to discuss or clarify items in the report.
This report will be released to the public on May 16, 2001.
Sincerely,
Debbie Davenport
Auditor General
Enclosure
OFFICE OF THE AUDITOR GENERAL
Program Fact Sheet
Department of Public Safety
Licensing Bureau
Concealed Firearms Licensing
Weapons Clearance Unit
Unit Unit
Facilities: The Licensing Bureau’s func-tions
are performed at the DPS Phoenix
office and an additional DPS location in
Tucson. These sites are state-owned.
Primary Program Revenue Sources:
(estimated fiscal year 2001)
$0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
Criminal Justice Enhancement Fund
General Fund
Permit, license, and registration fees
The Security Guard & Private Investigator Licensing Unit collects
fees which help offset the cost to the General Fund. In fiscal year
2001, DPS estimates that it will remit $361,700 in fees or about 89
percent of the amount of its General Fund appropriation for this
unit.
Hundred Thousands
Personnel: 35 (fiscal year 2001)
Concealed Weapon
Unit (7)
Administration (2)
Licensing
Unit (9)
Firearms Clearance
Center (17)
Services: This audit focuses on three of the Licensing Bureau’s four units: 1) Firearms Clear-ance
Center—performs background checks to determine the eligibility of individuals wishing
to purchase a firearm; 2) Security Guard and Private Investigator Licensing Unit—regulates
security guard and private investigator employees and the agencies that provide those ser-vices;
and 3) Concealed Weapon Permit Unit—issues concealed weapon permits to qualified
applicants, and licenses instructors and training organizations that provide the required train-ing.
Equipment: The Bureau uses six cars, which
are owned by DPS. These vehicles are pri-marily
used when conducting statewide
audits, investigations, and inspections asso-ciated
with the units’ regulatory functions.
Firearm
Clearance
Center
Security Guard &
Private Investigator
Licensing Unit
Concealed
Weapon
Permit Unit
OFFICE OF THE AUDITOR GENERAL
Goals and Performance Measures:
(fiscal years 2001—2003)
Goals: The Bureau has 3 goals and 11 per-formance
measures. The goals are:
1. To provide professional development
opportunities to employees and clients.
2. To improve efficiency and effectiveness
in administering mandated programs.
3. To improve customer service.
Adequacy of Goals and Performance
Measures:
The Licensing Bureau is a subprogram of the
Criminal Justice Support Division and there-fore
has relatively few performance meas-ures.
DPS has developed only two perform-ance
measures specific to the Bureau: per-centage
of employees offered training and
percentage increase in employee satisfaction.
Since the units within the Licensing Bureau
perform such unique functions, they have
developed a few additional individual per-formance
measures. However, more com-plete
measures are needed. These additional
performance measures should address each
unit’s specific responsibilities and should
include measures of input, output, outcomes,
efficiency, and quality. To assist in develop-ing
additional measures, DPS may want to
consider using the set of common inspection
and regulation performance measures out-lined
in the State’s Strategic Planning Guide-lines,
since the Licensing Bureau’s functions
are regulatory in nature.
i
OFFICE OF THE AUDITOR GENERAL
SUMMARY
The Office of the Auditor General has conducted a performance
audit of the Department of Public Safety’s Licensing Bureau as a
part of a Sunset review of the agency. This audit was conducted
pursuant to a June 16, 1999, resolution of the Joint Legislative
Audit Committee and was conducted under the authority vested
in the Auditor General by Arizona Revised Statutes (A.R.S.) §41-
2951 et seq. This is the fifth in a series of eight audits of the De-partment
of Public Safety.
The Department of Public Safety’s (DPS) Licensing Bureau is part
of the Criminal Justice Support Division, which provides regula-tory,
support, and other services essential to promoting public
safety in Arizona. This audit focuses on three of the Bureau’s four
programs: the Firearms Clearance Center, which determines an
individual’s eligibility to purchase a firearm; the Security Guard
and Private Investigator Licensing Unit, which regulates security
guard and private investigator agencies and employees; and the
Concealed Weapon Permit program, which issues permits to in-dividuals
qualified to carry concealed weapons in Arizona. The
fourth unit, Access Integrity, will be included in the audit of DPS’
Criminal Information Services Bureau.
Arizona Could Save $650,000 Annually by
Allowing FBI to Conduct Background Checks
(See pages 7 through 13)
The Legislature has the option of allowing the Federal Bureau of
Investigation (FBI) to perform the federally mandated firearm
background check function. The federal Brady Handgun Vio-lence
Prevention Act of 1994 requires that handgun, long gun,
and pawned gun purchasers undergo a background check to de-termine
whether they are legally allowed to buy a firearm. States
initially had to conduct these checks for the federal government,
but in November 1998, were given the option of transferring this
responsibility to the FBI. Currently, the FBI conducts all back-
The Legislature has the
option of transferring the
background check func-tion
to the FBI.
Summary
ii
OFFICE OF THE AUDITOR GENERAL
ground checks for 24 states and some of the background checks
for 11 other states. Arizona is 1 of only 15 states that have chosen
to retain the responsibility for conducting all background checks.
The Legislature should consider transferring the background
check function to the FBI. Having DPS conduct the checks pro-vides
few significant benefits beyond what the FBI can offer and
will cost the State about $650,000 in fiscal year 2001. Auditors de-termined
the FBI could provide effective background checks in
part by analyzing a random sample of purchases denied by DPS.1
In over 95 percent of these cases, the FBI would have had the in-formation
needed to deny a purchase. In most of the remaining
cases the denied individuals had active misdemeanor warrants,
and federal databases generally contain information on only fel-ony
warrants. While having an active warrant disqualifies an in-dividual
from purchasing a gun, the misdemeanor warrants in
these cases were for non-disqualifying offenses such as failure to
appear, or writing bad checks. In addition, the FBI more effec-tively
completes background checks on cases needing additional
research, a problem area for DPS’ program (see Finding II, pages
15 through 22). The FBI also offers more expanded hours than
Arizona, so transferring the background check function should
not inconvenience Arizona’s firearms dealers or gun buyers.
If the Legislature decides that DPS should retain the background
check function, it should consider providing DPS with the statu-tory
authority to charge fees to cover its operating costs. Cur-rently,
DPS primarily uses Criminal Justice Enhancement Fund
appropriations to pay for the program’s operating costs. How-ever,
most other states performing background checks charge a
fee to the licensed firearm dealer for each check, which typically
ranges from $5 to $15.
1 Auditors selected and analyzed 257 of approximately 7,400 purchases de-nied
by DPS since November 30, 1998.
FBI could offer effective
service.
Summary
iii
OFFICE OF THE AUDITOR GENERAL
DPS Should Take Steps to Ensure That
Only Eligible Individuals Can Buy Guns
(See pages 15 through 22)
If the Legislature decides that DPS should continue the back-ground
check function, DPS should take several steps to ensure
that guns are sold only to eligible persons. Although most back-ground
checks can be completed in minutes, some require addi-tional
research. For example, an individual’s criminal history re-cord
may list an arrest for a disqualifying offense such as bur-glary,
but the record does not indicate whether the person was
convicted. Therefore, to determine the individual’s eligibility to
purchase a firearm, DPS must contact a state or local criminal jus-tice
entity, such as a court, to obtain additional information.
In accordance with federal law, states are allowed a minimum of
three business days to conduct this research and DPS abides by
this standard. Therefore, dealers may sell the firearm after three
business days if DPS has not advised them that the individual is
ineligible to purchase a firearm. During calendar year 2000, DPS
was unable to complete background checks within the three-day
time frame for about 5,000 people, or 50 percent of the cases re-quiring
research. In these cases the dealer could legally sell the
weapon to the individual. However, it is unclear how many of
these individuals should have been prohibited from buying guns.
A review of nearly 200 such cases in which DPS did not complete
the background check for October 2000 found that more than
one-third of the individuals had arrests and/or charges on their
records for serious, disqualifying offenses, such as misconduct
with weapons, sexual assault, child abuse, and conspiracy to
commit murder.
Consistent with the intent of the law and practices in other states
that conduct their own background checks, DPS needs to make
several operational changes to ensure that ineligible individuals
are not allowed to buy guns. For example, DPS should follow the
practices of the FBI and other states by reassigning some of its ex-isting
staff to perform research as their primary function. In addi-tion,
DPS should also seek legislative authority that would allow
it to extend the sale of a firearm from 3 to 30 days. Other states
such as California, Georgia, and Tennessee have extended their
DPS was unable to com-plete
the background
checks for about 5,000
cases during calendar
year 2000.
Summary
iv
OFFICE OF THE AUDITOR GENERAL
research time frames and will not authorize the purchase of a gun
until the state confirms the buyer is eligible.
DPS Could Streamline Its Security Guard
and Private Investigator Application Process
(See pages 23 through 26)
By modifying its security guard and private investigator em-ployee
application practices, DPS could postpone its request for
additional staff and improve its oversight role. DPS staff currently
spend 15 to 20 minutes with each applicant reviewing their appli-cation
form with them. In addition, the application review proc-ess
is also inconvenient for applicants since DPS has only two li-censing
locations, Phoenix and Tucson, for the entire state.
DPS should revise its administrative rules and practices to allow
security guards and private investigators to submit applications
by mail. Specifically, applicants and the agencies they work for
could be responsible for obtaining a fingerprint card, and two
passport-sized photos, and ensuring that the application is com-plete
and contains sufficient information to show the applicant
meets the minimum qualifications. Once the application packet
was received, DPS would then determine if all the required in-formation
had been submitted and send the information to the
DPS unit conducting the criminal history background check on
the applicant. Auditors estimate that allowing security guards
and private investigators to submit applications by mail could
reduce DPS’ application review processing time at least in half, or
to ten minutes or less. This change could potentially postpone or
eliminate the need for additional staff and allow current staff to
dedicate more time to other regulatory functions, such as con-ducting
site compliance checks and investigating complaints.
DPS Could Improve Its Security
Guard Regulation Practices
(See pages 27 through 32)
DPS could improve its regulation of security guards by making a
few changes. To receive a security guard certificate, applicants
must meet statutory requirements, and be sponsored by a DPS-DPS
should change to a
mail-in application proc-ess.
Summary
v
OFFICE OF THE AUDITOR GENERAL
licensed security guard agency. Although security guards are not
granted any law enforcement powers beyond those of an average
citizen, it is the philosophy of DPS, as well as national security
and law enforcement organizations, that security guards are in
positions of trust and that untrained, unlicensed people are a po-tential
threat to public safety. However, many of the current li-censing
processes are not consistent with that philosophy. For
example, DPS issues a temporary permit, known as a provisional
certificate, that allows applicants to work for up to six months be-fore
they receive training, or their criminal history background
checks are complete. In addition, DPS does not conduct any fur-ther
background checks during the three-year period that the se-curity
guard is certified.
DPS should take the necessary steps to enhance its regulation of
security guards. Practices used by other states and recommended
by national security associations, such as the National Association
of Security and Investigative Regulators, are stricter than Ari-zona’s.
Consistent with other states and national associations,
DPS should:
Establish the type and amount of training required;
Require applicants to receive training prior to receiving their
provisional certificate;
Require continuing education during the certificate period;
Conduct state criminal history background checks before is-suing
a provisional certificate; and
Conduct additional background checks annually, during the
certificate period.
Some of these changes will require statutory revisions.
Other Pertinent Information
(See pages 33 through 36)
During the audit, other pertinent information was gathered re-garding
DPS’ Concealed Weapon Permit program, which began
in fiscal year 1995. DPS issues permits to qualified individuals,
DPS should conduct
regular state criminal
history background checks
on security guards.
Summary
vi
OFFICE OF THE AUDITOR GENERAL
approves the training organizations and instructors who provide
mandatory concealed weapon permit training, and conducts in-vestigations
or audits of permit holders, instructors, and training
organizations to ensure compliance with state concealed weapon
laws and rules. During the program’s first year, DPS issued over
27,500 permits. Further, as of the end of November 2000, 61,000
individuals had Arizona concealed weapon permits.
vii
OFFICE OF THE AUDITOR GENERAL
TABLE OF CONTENTS
Page
Introduction and Background........................... 1
Finding I: Arizona Could Save
$650,000 Annually byAllowing FBI
to Conduct Background Checks ................. 7
Individual States No Longer
Required to Perform the
Federally Mandated
Background Check................................................................. 7
Arizona’s Participation
Yields Few Benefits ................................................................ 9
If DPS Retains Function,
Fees Should Offset Operating Costs .................................. 12
Recommendations.................................................................. 13
Finding II: DPS Should Take Steps to
Ensure That Only Eligible
Individuals Can Buy Guns............................ 15
Incomplete Checks Increase
Risk to Public Safety............................................................... 15
Changes Are Needed to
Increase the Number of
Successfully Completed
Background Checks ............................................................... 18
Recommendations.................................................................. 22
Table of Contents
viii
OFFICE OF THE AUDITOR GENERAL
TABLE OF CONTENTS (Cont’d)
Page
Finding III: DPS Could Streamline
Its Security Guard and
Private Investigator
Application Process ...................................... 23
Security Guard and Private
Investigator Employee Application
Process Is Inefficient............................................................... 23
DPS Should Streamline Its
Application Process
and Devote More Time
to Oversight Functions.......................................................... 24
Recommendations.................................................................. 26
Finding IV: DPS Could Improve
Its Security Guard
Regulation Practices ..................................... 27
DPS Regulates
Security Guards....................................................................... 27
Lack of Training Requirements
and Regular Criminal History Checks
Impacts Effectiveness............................................................. 28
DPS Should Enhance Its
Training and Background Check
Requirements for Security Guards..................................... 29
Study Committee Established............................................. 31
Recommendations.................................................................. 32
Table of Contents
ix
OFFICE OF THE AUDITOR GENERAL
TABLE OF CONTENTS (Cont’d)
Page
Other Pertinent Information............................... 33
DPS Operates the Concealed
Weapon Permit Program...................................................... 33
Appendix.............................................................. a-i
Agency Response
Table
Table 1 Department of Public Safety
Licensing Bureau
Statement of Revenues, Expenditures,
and Changes in Fund Balance
Years Ended or Ending June 30, 2000
and 2001 (Unaudited)........................................ 3
Items
Item 1 Examples of Federal and State
Gun Purchaser Disqualifiers ........................... 8
Item 2 Examples of Security Guard
Applicant Qualifications................................... 28
Item 3 Concealed Weapon
Permit Requirements......................................... 33
Table of Contents
x
OFFICE OF THE AUDITOR GENERAL
TABLE OF CONTENTS (Concl’d)
Page
Figures
Figure 1 Department of Public Safety
Licensing Bureau
Results of Initial Firearm Background Check
Year Ended December 31, 2000
(Unaudited) ......................................................... 16
Figure 2 Department of Public Safety
Licensing Bureau
Results of Delayed Background Checks
Year Ended December 31, 2000
(Unaudited) ......................................................... 17
Figure 3 Department of Public Safety
Licensing Bureau
Initial and Renewal Concealed Weapon
Permits Issued Annually
Years Ended June 30, 1995
through 2000........................................................ 35
1
OFFICE OF THE AUDITOR GENERAL
INTRODUCTION AND BACKGROUND
The Office of the Auditor General has conducted a performance
audit of the Department of Public Safety’s Licensing Bureau as
part of a Sunset review of the agency. This audit was conducted
pursuant to a June 16, 1999, resolution of the Joint Legislative
Audit Committee. This audit was conducted under the authority
vested in the Auditor General by Arizona Revised Statutes
(A.R.S.) §41-2951 et seq. This is the fifth in a series of eight audits
of the Department of Public Safety.
Licensing Bureau Provides
Arizona with Various Licensing
and Regulatory Services
The Department of Public Safety’s (DPS) Licensing Bureau is
part of the Criminal Justice Support Division, which provides
regulatory, support, and other services essential to promoting
public safety in Arizona.1 This report focuses on three of the Li-censing
Bureau’s four programs: the Firearms Clearance Center;
Security Guard and Private Investigator Licensing Unit; and
Concealed Weapon Permit program.2 Each of the three units per-forms
a unique licensing or regulatory function and has distinct
funding sources (see Table 1, page 3).
Firearms Clearance Center (17 FTEs)—The Firearms
Clearance Center (Center) determines an individual’s eligibil-ity
to purchase a firearm by means of a national automated
1 The Division also includes the following other Bureaus: Criminal Informa-tion
Services, Fingerprint Identification, Information Technology, Opera-tional
Communications, Scientific Analysis, and Telecommunications.
2 The Bureau also includes the Access Integrity Unit, which is responsible
for training and auditing network users of the State’s automated criminal
justice information system, and will be incorporated into an Auditor Gen-eral
review of the Criminal Information Services Bureau.
Introduction and Background
2
OFFICE OF THE AUDITOR GENERAL
instant background check system. This national system was
established in federal law, which mandates that individuals
purchasing a firearm from a licensed firearms dealer must
undergo an instant background check. Similar to some states,
Arizona has chosen to perform these background checks on
behalf of the federal government, whereas the FBI performs
the background checks for nearly half of the states. Back-ground
checks involve searching state and national criminal
history databases, and other sources for information that
would disqualify the individual from purchasing a gun, such
as a felony conviction, active warrant, or misdemeanor con-viction
for domestic violence (see the Appendix, page a-i, for
a listing of the applicable databases). During calendar year
2000, the Center processed about 127,000 background checks
for Arizona’s firearms dealers. The Center’s estimated ex-penditures
for fiscal year 2001 are approximately $650,000,
with monies from the Criminal Justice Enhancement Fund
(CJEF) as its primary funding source.
Security Guard and Private Investigator Licensing Unit (9
FTEs)—The Security Guard and Private Investigator Licens-ing
Unit is responsible for regulating individual security
guards and private investigators, and the agencies that pro-vide
these services. Regulating agencies and individuals in-volves
determining each applicant’s eligibility and investigat-ing
suspected illegal behavior of either employees or agency
officials. At the end of fiscal year 2000, the unit reported that
there were 208 licensed security guard agencies and 12,593
certified security guards, and 1,242 private investigator agen-cies
and 2,143 private investigators. While the State’s General
Fund provides most of the unit’s revenue, monies collected
from application fees are remitted to the General Fund. The
unit’s estimated expenditures for fiscal year 2001 are ap-proximately
$415,000.
Concealed Weapon Permit Program (7 FTEs)—The Con-cealed
Weapon Permit Program is responsible for issuing
permits to individuals qualified to carry concealed weapons
in Arizona. In addition, it approves training instructors and
training organizations responsible for providing required
concealed weapon permit training. The unit also conducts
Table 1
Department of Public Safety
Licensing Bureau
Statement of Revenues, Expenditures, and Changes in Fund Balance1
Years Ended or Ending June 30, 2000 and 2001
(Unaudited)
Firearms Clearance Center
Security Guards and
Private Investigator
Licensing Unit
Concealed Weapon
Permit Program
2000
(Actual)
2001
(Estimated)
2000
(Actual)
2001
(Estimated)
2000
(Actual)
2001
(Estimated)
Revenues:
Appropriations:
State General Fund $ 2,100 $ 10,800 $420,000 $407,200 $ 2,300 $ 10,700
Criminal Justice Enhancement Fund 2 585,700 638,600
Arizona Highway Patrol Fund 3 6,100 9,500
Licenses and permits 361,700 361,700 453,070 330,000
Total revenues 587,800 649,400 787,800 778,400 455,370 340,700
Expenditures:
Personal services and employee related 481,203 543,800 392,200 395,400 400,852 370,000
Professional and outside services 275 2,800 2,600 6,615 4,800
Travel 1,290 1,400 1,300 1,000 2,262
Other operating and equipment 102,783 104,200 27,700 15,600 60,931 39,200
Total expenditures 585,551 649,400 424,000 414,600 470,660 414,000
Excess of revenues over (under) expenditures 2,249 363,800 363,800 (15,290) (73,300)
Other financing uses:
Reversion to the State General Fund 2,100 2,100
Reversion to the Criminal Justice Enhancement Fund 2,249
Remittance to the State General Fund 361,700 361,700
Total other financing uses 2,249 363,800 363,800
Excess of revenues over (under) expenditures and other uses (15,290) (73,300)
Fund balance, beginning of year 185,070 169,780
Fund balance, end of year $ 0 $ 0 $ 0 $ 0 $169,780 $ 96,480
1 The Bureau’s revenues and expenditures include an allocation of revenues and expenditures recorded in the Department’s Joint Account. The Joint Account contains State General Fund
appropriations and other appropriated monies, such as amounts from the Criminal Justice Enhancement Fund.
2 Consists of fines and forfeits deposited in the Criminal Justice Enhancement Fund (CJEF) and appropriated to the Department. Unexpended CJEF monies are presented as a reversion to CJEF
since any unexpended monies at year-end are subject to legislative appropriation in future years.
3 Appropriations to the Arizona Highway Patrol Fund consist of insurance premium taxes used to pay for eligible contributions to the Pubic Safety Personnel Retirement System.
Source: Auditor General staff analysis of information provided by the Department of Public Safety.
OFFICE OF THE AUDITOR GENERAL 3
Introduction and Background
Introduction and Background
4
OFFICE OF THE AUDITOR GENERAL
investigations into alleged misconduct of permit holders, ap-plicants,
instructors, and organizations. During fiscal year
2000, the program processed over 10,000 initial and 7,200 re-newal
permits, and at the end of November 2000 there were
over 61,000 active permit holders. Funding for the program is
derived from permit application fees, which are transferred
into a revolving fund. The program’s estimated expenditures
for fiscal year 2001 are approximately $518,000.
Audit Scope and
Methodology
Several methods were used to study the issues addressed in this
audit, including:
Firearms Clearance Center—Auditors reviewed national
literature on the development and implementation of the na-tional
instant criminal background check system (NICS); and
U.S. Code and Arizona statutes for gun requirements, includ-ing
those for purchasing and possessing firearms. To deter-mine
whether the FBI could provide comparable service,
auditors reviewed files from 257 of approximately 7,400 pur-chasers
denied by DPS since November 30, 1998, to identify
whether the FBI would have had access to the information
necessary to deny the purchase. Auditors also reviewed in-formation
on cases requiring additional research during Oc-tober
2000 to assess the Center’s research and documentation
efforts. Auditors contacted 10 of the 14 other states that per-form
all of their own background checks, and 4 of the 11
states that allow the FBI to conduct at least some of their
state’s background checks. States were contacted to deter-mine
how other states’ programs operate and to identify best
practices for performing and completing research. 1
1 Those states contacted that perform all their own background checks were
California, Colorado, Florida, Georgia, Illinois, Nevada, New Jersey, Penn-sylvania,
Tennessee, and Virginia. States contacted that have the FBI per-form
some of their background checks were Indiana, Maryland, Oregon,
and Wisconsin.
Introduction and Background
5
OFFICE OF THE AUDITOR GENERAL
Security Guard and Private Investigator Licensing Unit—
Auditors reviewed the unit’s policies and procedures, and
applicable statutes and administrative rules, which mandate
the licensing function. Auditors observed licensing processes
and conducted interviews with management and staff. Audi-tors
also reviewed agency documents that contained sum-mary
information on interviews conducted with security
guard agencies, to better understand issues within the indus-try.
Auditors analyzed best practices recommended by the
International Chiefs of Police and the National Association of
Security and Investigative Regulators (NASIR), and reviewed
summary information on state regulation practices for secu-rity
guard and private investigators compiled by the NASIR
in its State Licensing Information publication. Auditors also
researched licensing information from various state Web
sites, as well as contacted officials from seven states, to gain a
better understanding of how other states operate and obtain
information about best practices.1
Concealed Weapon Permit Program—Auditors reviewed
applicable statutes and administrative rules, and national lit-erature
that discusses the development of concealed weapon
programs. Additionally, auditors observed activities for issu-ing
permits, attended a training program DPS conducts for
instructors, and conducted interviews with management and
staff to become more familiar with the program’s operations.
This report presents findings and recommendations in four ar-eas:
The need for the Legislature to consider transferring the fire-arms
clearance function to the FBI;
The need for DPS to improve its ability to ensure that only
eligible individuals are allowed to buy guns;
The need for DPS to streamline its security guard and private
investigator employee application process; and
1 Licensing information was obtained from the following states’ Web sites:
Arkansas, California, Connecticut, Florida, Georgia, Illinois, Nevada, New
York, Oregon, Texas, and Utah.
Introduction and Background
6
OFFICE OF THE AUDITOR GENERAL
The need for DPS to improve its security guard regulation
practices.
Additionally, this audit presents other pertinent information on
the DPS’ Concealed Weapon Permit program and its functions.
This audit was conducted in accordance with government audit-ing
standards.
The Auditor General and staff express appreciation to the Direc-tor
and staff of the Department of Public Safety for their coopera-tion
and assistance during the audit.
7
OFFICE OF THE AUDITOR GENERAL
FINDING I ARIZONA COULD SAVE
$650,000 ANNUALLY BY
ALLOWING FBI TO CONDUCT
BACKGROUND CHECKS
The Legislature has the option of allowing the FBI to perform the
federally mandated firearms background check function. While
Arizona chose to retain this function in 1998, it yields few signifi-cant
benefits beyond what the FBI can provide and will cost the
State an estimated $650,000 for fiscal year 2001. Therefore, the
Legislature should consider transferring the background check
responsibility from DPS to the FBI. If the Legislature decides that
DPS should continue this function, it should consider providing
DPS with statutory authority to charge a fee so that it can recover
the cost for operating this federally mandated program.
Individual States No Longer
Required to Perform the
Federally Mandated
Background Check
The federal Brady Handgun Violence Prevention Act of 1994
(Brady Act) requires that individuals purchasing firearms from
licensed firearm dealers undergo a background check by means
of the national instant criminal background check system,
known as NICS.1 Initially, state or local governments were re-sponsible
for conducting their own background checks on hand-gun
purchases only. However, beginning on November 30, 1998,
the second phase of the Brady Act was implemented and back-ground
checks were also required on long gun and pawned gun
1 Although the Brady Act uses the term “transfer” of firearms, “sale” or
“purchase” are more common terms used to describe the exchange be-tween
dealer and buyer and are therefore the terms used in this report.
Finding I
8
OFFICE OF THE AUDITOR GENERAL
purchases. In addition, each state was also given the option of
continuing to perform the background checks, or allowing the
FBI to perform this function. Arizona chose to retain the respon-sibility
and DPS’ Firearms Clearance Center conducts the re-quired
check for individuals purchasing guns from federally li-censed
firearm dealers.1 Completing a background check in-volves
searching state and national criminal history databases,
and other sources for information that would disqualify the in-dividual
from purchasing a gun. Such disqualifiers include fel-ony
convictions, active warrants, or misdemeanor convictions for
domestic violence (see Item 1 above for a list of disqualifiers).
Disqualifiers are established in both federal and state law, and
Arizona’s mirror those set forth in the Brady Act in nearly every
respect.
People who want to purchase a gun from a licensed dealer must
complete a purchase request form that asks for identifying in-formation,
such as their name, address, date of birth, and social
security number.2 In addition, the form asks them to answer
1 Any business entity wishing to sell firearms must be licensed to do so by
the United States Bureau of Alcohol, Tobacco, and Firearms (ATF). There
are nearly 1,400 licensed firearms dealers in Arizona.
2 Department of the Treasury, Bureau of Alcohol, Tobacco and Firearms,
Firearms Transaction Record Part I—over-the-counter form ATF4473.
Item 1 Examples of Federal and State
Gun Purchaser Disqualifiers
Under indictment for or convicted of a felony
Fugitive from justice (active warrant)
Convicted of a misdemeanor crime of domestic violence
Subject to a court restraining order
Unlawful user or addicted to illegal drugs
Dishonorably discharged from the Armed Forces
Illegal alien, or has renounced U.S. citizenship.
Source: 18 U.S. Code §922 (d) and (g), and A.R.S. §31-3101.6 and
§31-3114(B)
Finding I
9
OFFICE OF THE AUDITOR GENERAL
other questions, such as whether they are currently under in-dictment,
are legally in the United States, or have ever been con-victed
of a felony. The dealer either calls or faxes DPS with the
identifying information and requests a background check. DPS
performed about 127,000 checks in calendar year 2000.
Arizona’s Participation
Yields Few Benefits
Having DPS perform the background check on Arizona gun
buyers does not yield any significant benefits, yet will cost the
State an estimated $650,000 in fiscal year 2001. It is unclear why
Arizona chose to retain this function. However, 24 states allow
the FBI to perform the entire background function for all firearm
purchases and auditors’ analysis suggests the FBI’s services
would be equally effective as DPS’ function. Therefore, the Legis-lature
should consider transferring the background check re-sponsibility
to the FBI. Transferring this function will require
statutory change and coordination with the federal government.
Arizona chose to perform its own background checks—Even
though states were given the option of transferring the back-ground
check responsibility to the FBI in November of 1998, Ari-zona
chose to retain this function. A review of legislative hearing
minutes during 1998 provides little clarification on why Arizona
decided to retain this function. However, there did appear to be
some confusion or uncertainty as to whether Arizona was re-quired
to continue performing this function. Further, appropria-tion
reports for fiscal years 1996 through 1999 contain language
suggesting that retaining this function at the state level would
eliminate the need for each of the 15 counties to individually de-velop,
fund, and operate its own background check programs.
These reports do not discuss the option of having the FBI take
over this responsibility for Arizona. Additionally, retaining the
responsibility was perceived as a convenience to Arizona’s li-censed
firearms dealers, as they were already familiar with the
process.
Twenty-four states have the FBI perform the entire background
check function—Twenty-four states have chosen to have the FBI
do all of their state’s background checks. In addition, 11 states
Conducting background
checks will cost $650,000
in fiscal year 2001.
Finding I
10
OFFICE OF THE AUDITOR GENERAL
have chosen to retain the background check responsibility for
handgun purchases only, but have the FBI perform the addi-tional
checks. Interviews with state officials suggest that they did
not take on the additional background check responsibilities be-cause
their state’s statutes were never changed and/or they did
not have the financial resources to complete the additional
checks required under the second phase of the Brady Act. Ari-zona
is 1 of only 15 states that have chosen to perform the back-ground
checks for all gun purchases.1
FBI could provide Arizona with effective service—The responsi-bility
for conducting background checks could be transferred to
the FBI without reducing effectiveness. In theory, states may de-sire
to complete their own background checks because they have
established stricter gun laws than those outlined in the Brady Act
or may have access to additional information not available to the
FBI.2 However, neither of these reasons appear to be important
factors in Arizona’s case.
To determine in part whether the FBI could provide comparable
service, auditors reviewed a random sample of 257 purchases
denied by DPS since November 30, 1998, to identify whether the
FBI would have had access to the information necessary to deny
the purchase. Among the 257 denied cases, auditors found only
12 cases in which the FBI may have approved the purchase. For
10 of these cases DPS denied the purchase because the individual
had an active misdemeanor warrant, which is a disqualifier. The
FBI may not have had this information because federal databases
generally contain information on only felony warrants. How-ever,
the active misdemeanor warrants for these cases were for
nondisqualifying offenses, meaning that once the warrants were
resolved, even if the individuals were convicted of the offenses,
they would not have been disqualified from purchasing a gun.
For example, the warrants were for misdemeanor charges such
1 Florida performs its own background checks on all firearm purchases, ex-cept
for certain pawned firearm transactions. For example, when a
pawned firearm is purchased back within 90 days, the broker may call ei-ther
the state or the FBI for a background check.
2 United States General Accounting Office (GAO), Report to Congressional
Requesters. Gun Control: Options For Improving the National Instant Criminal
Background Check System. Washington, D.C.: April 2000.
Many states allow the FBI
to conduct background
checks.
Finding I
11
OFFICE OF THE AUDITOR GENERAL
as failure to appear, writing bad checks, driving under the influ-ence,
and failure to pay a fine. The two remaining denied cases
included one misdemeanor conviction from ten years ago, which
is generally not contained on the federal databases, and one re-cent
felony arrest and charge which had not yet been transferred
to the federal databases.
In addition to providing comparable service on denied cases, the
FBI could probably provide better service in other areas. Specifi-cally,
the FBI more effectively completes background checks on
cases needing additional research by completing a higher per-centage
of checks within the minimum 3 days currently allowed
by federal law, and by extending its research beyond the 3 days
if necessary. Both of these are problem areas for DPS’ program
(see Finding II, pages 15 through 22, for additional information).
Transferring the background check function to the FBI should
also not inconvenience Arizona’s firearms dealers or gun buyers,
given that the FBI’s program offers more expanded hours than
Arizona, operating 17 hours a day, 7 days a week, except on
Thanksgiving and Christmas.1 Similar to the current process,
Arizona’s firearm dealers would use a toll-free number to phone
the FBI program.
Transferring this function will require repealing statute and co-ordinating
with the FBI— Transferring the background check
function from DPS to the FBI will require the Legislature to re-peal
the Firearms Clearance Center’s enabling statutes, A.R.S.
§13-3114. In addition, the State would need to coordinate the
transfer with the FBI. Although each state decides whether it will
conduct its own background checks, the FBI requests a 60-day
written notification from the states wishing to transfer the func-tion.
This allows the FBI time to prepare adequate staffing to
handle the increased workload, become familiar with the state’s
gun laws and program, and to communicate the change to fire-arm
dealers.
DPS should be involved in coordinating the transfer to ensure
that other DPS units are not unnecessarily impacted by the
1 DPS’ Firearms Clearance Center is open 7 days a week: 12 hours on week-days,
and 9 to 10 hours on weekends. It is closed on 6 holidays, and has
shortened hours on 6 other holidays.
Finding I
12
OFFICE OF THE AUDITOR GENERAL
change. Another unit in DPS also has some responsibility for re-searching
incomplete criminal history information for the FBI
now. Specifically, if the FBI is conducting a background check for
another state and finds incomplete Arizona criminal history in-formation,
it contacts DPS’ Criminal Information Services Bureau
because DPS serves as the central point of contact for missing
criminal history information. During a recent calendar year pe-riod,
the Bureau completed about 1,700 such research requests
for the FBI. DPS estimates that if the background check function
is transferred to the FBI, this bureau’s workload would increase
by about 5,000 requests and cost about $50,000 to complete. In
auditors’ discussions with the FBI, it indicated that the process it
uses to complete its research on Arizona criminal history infor-mation,
such as whether to have a central point of contact or use
local entities, could be discussed and changed if necessary.
If DPS Retains Function,
Fees Should Offset Operating Costs
If the Legislature decides to have DPS retain the background
check function, it should consider providing DPS the statutory
authority to charge fees. Most of the states that conduct their
own checks charge a fee to licensed firearm dealers to help offset
their program’s costs. For example, among the 15 states that per-form
the background check for all gun purchases, Arizona is 1 of
only 3 states that do not currently charge a fee.1 Additionally, 8
of the 11 states that perform handgun checks only charge a fee.
The fees charged typically range from $5 to $15 per background
check. DPS currently funds the background check function pri-marily
from its annual appropriated portion of Criminal Justice
Enhancement Fund (CJEF) monies. However, if DPS was author-ized
to charge a nominal fee, such as $5 to $10 per background
check, the fee revenue could cover Arizona’s annual program
cost.
Other states that charge fees have also established specific funds
for the fees collected by the program. Therefore, the Legislature
1 Colorado and Vermont are the other two states that do not charge a fee for
conducting background checks on their state’s firearm transactions.
Most states charge fees for
conducting background
checks.
Finding I
13
OFFICE OF THE AUDITOR GENERAL
should also consider providing DPS with statutory authority to
establish a separate fund to account for the fees remitted to the
program and to be used to cover the program’s annual operating
expenditures. If the Legislature provides DPS the statutory au-thority
to charge fees, DPS should establish policies and proce-dures
for collecting the fees from licensed firearm dealers.
Recommendations
1. To save the State about $650,000 annually, the Legislature
should consider transferring the responsibility of conducting
firearm background checks to the FBI. This change would re-quire
repealing A.R.S. §13-3114 and coordination with the
FBI.
2. If the Legislature decides that DPS should retain this respon-sibility,
it should consider providing DPS the statutory au-thority
to recover its operating costs by assessing a nominal
fee.
3. If the Legislature provides DPS the statutory authority to es-tablish
a fee, it should also consider providing DPS with the
authority to establish a separate fund to account for the fees
remitted to the program, and to be used to cover the pro-gram’s
operating expenditures.
4. If the Legislature provides DPS the statutory authority to as-sess
a fee for performing background checks, DPS should
develop policies and procedures for collecting fees from li-censed
firearm dealers.
14
OFFICE OF THE AUDITOR GENERAL
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15
OFFICE OF THE AUDITOR GENERAL
FINDING II DPS SHOULD TAKE STEPS TO
ENSURE THAT ONLY ELIGIBLE
INDIVIDUALS CAN BUY GUNS
If the Legislature decides that DPS should continue conducting
background checks, DPS should take several steps to ensure that
guns are sold only to persons who meet the law’s criteria. During
calendar year 2000, DPS was unable to effectively complete the
background search within the allotted time for about 5,000 cases.
Because the deadline could not be met, these people were able to
purchase guns without DPS determining their eligibility to do so.
Auditors’ review of nearly 200 such cases for October 2000
showed that more than one-third of the cases in which DPS did
not complete the background check involved people whose
criminal history records showed arrests or charges for disqualify-ing
offenses such as robbery, aggravated assault, or conspiracy to
commit murder. DPS needs to make several changes to its proc-esses
to better ensure that it completes all background checks so
that, consistent with the intent of the law, ineligible individuals
are not allowed to purchase guns.
Incomplete Checks Increase
Risk to Public Safety
DPS is not effectively completing all background checks within
the allotted time. Most background checks can be completed
quickly, but others require additional research to determine
whether the individual is allowed to purchase a gun. However,
during calendar year 2000, half of the cases that required addi-tional
research were not completed within the time allowed un-der
federal law. When DPS does not complete its research within
the allotted time, individuals who could have been disqualified
may be allowed to buy guns.
Half of the cases requiring research proceed by default—During
calendar year 2000, DPS did not complete the background check
within three business days for half of the cases that required re-search.
Most background checks can be completed in a
Finding II
16
OFFICE OF THE AUDITOR GENERAL
matter of minutes, but some require additional research. For ex-ample,
of the approximately 127,000 checks conducted during
calendar year 2000, 91 percent were immediately approved or
denied. However, for 8 percent of the background checks, DPS
had to delay the sale of the firearm to further research the indi-vidual’s
eligibility to purchase a gun (see Figure 1). The cases re-quiring
additional research are known as delayed cases.
It is important to research delayed cases because the individuals
who require research have information in their criminal history
record to suggest that they may be ineligible to purchase a gun.
For example, DPS needs to conduct research when an individ-ual’s
record lists one or more arrests for a disqualifying offense
but does not indicate whether the individual was convicted. Re-search
typically involves contacting a state or local entity, such as
a court, to obtain additional information. Pursuant to federal law,
a minimum of three business days is allowed to conduct this re-search
and DPS abides by these minimum standards. Therefore,
Figure 1
Department of Public Safety
Licensing Bureau
Results of Initial Firearm Background Check
Year Ended December 31, 2000
(Unaudited)
Immediate
denial
(3,194)
3%
Immediate
approval
(112,200)
88%
Delayed (10,095)
8%
Pending (1,391)
1%
a Cases result in a pending status when a computerized database is temporarily inac-cessible.
The background check is performed on these cases once the system be-comes
available.
Source: Auditor General staff analysis of daily background check statistics for 2000
provided by the Department of Public Safety.
a
Finding II
17
OFFICE OF THE AUDITOR GENERAL
dealers are allowed to sell the firearm after three business days if
they have not been advised by DPS that the individual is ineligi-ble.
These types of sales are known as default proceed cases.
During calendar year 2000, over 10,000 cases in Arizona required
additional research. However, DPS was unable to complete the
research within 3 business days for over 5,000 cases, or 50 percent
of the cases requiring research, and the dealer was legally allowed
to proceed with the sale (see Figure 2).
Ineligible individuals may be allowed to buy guns—When re-search
is not completed, ineligible people may be allowed to buy
guns. While it is unclear how many ineligible people in Arizona
have purchased guns, according to FBI research, among the cases
in which an individual’s arrest record may indicate potential dis-qualification
but research cannot be completed within 24 hours,
the individual is almost 20 times more likely to be an ineligible in-dividual
compared to transactions involving the average gun
buyer. In addition, auditors reviewed nearly 200 default proceed
cases for the month of October 2000 and found that more than
one-third of the prospective gun buyers had previously been ar-rested
and/or charged with serious disqualifying offenses, such as
misconduct with weapons, sexual assault, child abuse, arson, rob-bery,
aggravated assault, or conspiracy to commit murder.
Figure 2
Department of Public Safety
Licensing Bureau
Results of Delayed Background Checks
Year Ended December 31, 2000
(Unaudited)
Approved
(3,889)
39%
Denied (1,148)
11%
Proceed by
default (5,058)
50%
Source: Auditor General staff analysis of monthly delayed case research statistics for
2000 provided by the Department of Public Safety.
Finding II
18
OFFICE OF THE AUDITOR GENERAL
Changes Are Needed to
Increase the Number of
Successfully Completed
Background Checks
DPS needs to make operational changes to the background check
program to better ensure that ineligible individuals are not al-lowed
to buy guns. These changes should include reassigning
some staff to ensure research is completed on delayed cases, ini-tiating
research earlier, and seeking legislative authority to ex-tend
the research time for hard-to-resolve cases.
Increase the emphasis on research by reassigning some existing
staff—DPS could reduce the number of default proceed cases by
dedicating some existing staff to the crucial role of research. Until
March 2000, none of the 16 positions that perform background
checks were assigned the specific responsibility of conducting
research for delayed cases. Instead, they performed research only
as time permitted.1 Further, DPS’ policy requires that a mini-mum
of only one attempt be made to obtain additional informa-tion
on cases requiring research.
In contrast to Arizona’s operations, the FBI and other states place
greater emphasis on research by dedicating some staff to con-ducting
research. For example, 9 of the 14 states contacted dedi-cate
at least 2 FTEs to completing research. In addition to reas-signing
some staff, DPS should also revise its policies to require
more than one attempt to obtain additional information on cases
needing research.
Initiate research efforts earlier, while building on previous re-search
results—To improve its ability to complete background
checks within the three-day period, DPS should begin research
earlier and use the information from previously denied applica-tions.
Although there is nothing to preclude DPS from beginning
research immediately, it typically does not begin research on de-layed
cases until the following day, and sometimes not until
even the second or third business day. DPS could improve its
1 Effective March 2000, DPS established a procedure to assign two to three
staff a day to conduct research only.
DPS should reassign
some staff primarily to
conducting research on
delayed cases.
Finding II
19
OFFICE OF THE AUDITOR GENERAL
chances of confirming a buyer’s eligibility by instituting proce-dures
for initiating research as soon as practical following the
initial check.
As a first step in performing research, DPS should check its files
on previously disqualified individuals. Although DPS maintains
records on denied cases for a five-year period, it does not regu-larly
check this information when conducting research on a new
case. If the current buyer was previously disqualified, the infor-mation
in their file could provide some guidance as to why he or
she may need to be denied again. In addition, DPS may want to
make a change to its computer system so that it will automati-cally
alert staff when a prospective buyer was previously denied.
Although management requested this change in 1996, it has not
yet been made.
Extend the research time for those hard-to-resolve cases—DPS
should also seek legislative authority to extend the amount of
time it is allowed to research and confirm a gun buyer’s eligibil-ity.
Default proceed cases occur primarily because many states’
automated criminal history records do not show the dispositions
(acquittals or convictions) for arrests, and efforts to obtain such
information take longer than three business days. Although the
time frame for completing research is not addressed in Arizona
statute, DPS abides by the Brady Act’s minimum requirement of
three business days. However, several other states that conduct
their own background checks extend the research period or deny
purchases if they cannot readily determine eligibility. For exam-ple,
California, Georgia, and Tennessee will not authorize the
purchase of a gun until the state confirms the buyer is eligible,
regardless of how long it takes. Additionally, some states’ stat-utes,
such as Colorado, and Washington, allow them to deny an
individual when the individual’s criminal record contains a po-tentially
disqualifying charge, regardless of whether the state can
confirm that the individual was found guilty. Some examples of
how states ensure that only qualified individuals are sold guns
are noted below:
Colorado can deny a purchaser with an open disqualifying
arrest, such as a felony, even if the disposition cannot be ob-tained
within three days, thus eliminating the need for addi-tional
time to further research the transaction.
DPS should initiate re-search
efforts earlier.
Several other states delay
or deny purchases if eligi-bility
cannot be readily
determined.
Finding II
20
OFFICE OF THE AUDITOR GENERAL
Georgia’s regulations indicate that when a background
check identifies potentially disqualifying charges, the gun
dealer may not sell the firearm until being advised by the
state that the purchaser is not prohibited.
Washington state law allows up to five days to perform a
background check. However, if available records indicate the
prospective purchaser has an arrest for a potentially disquali-fying
offense, a hold for up to 30 days can be placed on the
transaction to allow the state additional time to verify the
purchaser’s eligibility. If additional time is needed beyond 30
days, an extension can be sought through a judicial order.
FBI data suggests that allowing more time to research delayed
checks would affect a relatively small portion (2 percent) of all
transactions, yet a 30-day extension could reduce the number of
default proceed cases by 77 percent. Furthermore, the U.S. De-partment
of Justice has stated it would support changing the
three-day requirement.
To ensure DPS can better meet the intent of the Brady Act and
complete all background checks on prospective gun buyers, DPS
should seek legislative authority to amend §13-3114 to allow it to
delay the sale of a firearm up to 30 days. Statutory changes
should also include direction on how DPS should handle cases
where the necessary information cannot be obtained within 30
days, such as whether the case would be denied on potentially
disqualifying information.
Improve procedures for proper interaction with licensed dealers,
ATF, and gun buyers—DPS should also enhance other written
procedures and provide staff proper instruction to better ensure
that appropriate actions are taken on delayed and denied trans-actions.
Specifically, DPS should develop or revise its procedures
for:
Ensuring prompt communication—DPS should develop
procedures for communicating in a timely manner informa-tion
on denied cases to licensed dealers. Although DPS’ pro-cedures
indicate that the dealer should be contacted, they do
Finding II
21
OFFICE OF THE AUDITOR GENERAL
not specify that the contact be documented, or specify a time-frame
for making the contact.
Notifying ATF immediately upon learning a disqualified
person obtained a gun—Currently there is no written pro-cedure
establishing a time frame for notifying the Bureau of
Alcohol, Tobacco, and Firearms (ATF) when a disqualified
person has been sold a gun. When DPS discovers that an in-eligible
person has been sold a firearm, DPS contacts ATF
and ATF then takes the steps necessary to retrieve the fire-arm.
The FBI’s procedure states it will notify ATF within six
to eight hours. However, a review of DPS’ 22 documented
contacts with ATF from December 1999 through October
2000 indicates that on at least one occasion DPS waited more
than three weeks before notifying the ATF that a disqualified
individual was sold a gun. In two other instances, DPS did
not notify ATF for one week or more.
Responding to gun buyer’s inquiries and appeals—DPS
should also develop administrative rules for handling inquir-ies
and appeals by gun buyers whose purchases are delayed
or denied. Statute allows DPS to adopt rules for establishing
an appeals process to inform denied gun buyers of the basis
for their denial. However, DPS has established only informal
guidelines for how it will respond to gun buyers’ inquiries.
More inquiries may occur if the Legislature grants DPS the
authority to extend the research time for hard-to-resolve
cases. Therefore, DPS should develop administrative rules
that outline the steps DPS will take, as well as what actions
the gun buyer has available.
Finding II
22
OFFICE OF THE AUDITOR GENERAL
Recommendations
If the Legislature decides DPS should continue performing the
background check function:
1. DPS should continue to allocate some of its existing staff po-sitions
to perform research as their primary responsibility on
cases where DPS cannot immediately determine whether a
person is eligible to purchase a gun.
2. DPS should begin research cases immediately or as soon as
practical on cases that require additional research to deter-mine
whether an individual is eligible to purchase a gun.
3. DPS should use its files on previously denied cases to help it
more efficiently complete its research.
4. DPS should make a change to its computer system so that it
will automatically notify staff when a prospective buyer was
previously denied.
5. DPS should seek legislative authority to allow it to delay the
sale of a firearm from 3 to 30 days, and to indicate how it will
resolve the cases that it cannot determine eligibility for within
30 days.
6. DPS should develop procedures specifying a time frame for
contacting firearms dealers when research is complete, and
documenting that the contacts have been made.
7. DPS should develop procedures for promptly notifying ATF
when information indicates that an ineligible individual was
sold a gun.
8. DPS should establish administrative rules for responding to
delayed and denied gun buyers’ inquiries and appeals.
23
OFFICE OF THE AUDITOR GENERAL
FINDING III DPS COULD STREAMLINE
ITS SECURITY GUARD AND
PRIVATE INVESTIGATOR
APPLICATION PROCESS
By modifying its security guard and private investigator em-ployee
application practices, DPS could reassess the need for ad-ditional
staff and enhance its oversight role for these professions.
DPS’ current practices are inefficient because they require per-sonal
contact with each applicant. DPS should change to a pri-marily
mail-in application process, and devote more time to
other regulatory functions, such as conducting compliance site
visits and investigating complaints.
Security Guard and Private
Investigator Employee Application
Process Is Inefficient
Some of DPS’ licensing processes are inefficient. During fiscal
year 2000, DPS processed over 11,000 security guard and 950
private investigator employee initial and renewal applications. In
addition, DPS processed 73 security guard agency and 526 pri-vate
investigator agency initial and renewal applications. DPS is
having difficulty meeting its workload demands. As a result, for
fiscal year 2002 DPS sought an additional 5 FTE at an annual cost
of over $114,000.
One key reason DPS is unable to meet its current workload de-mands
is because its application process for security guard and
private investigator employees is inefficient. Although not re-quired
in statute, DPS’ administrative rules stipulate that each
applicant must apply in person. DPS explains that this practice
enables it to obtain the applicant’s fingerprints, photos, and sig-nature,
and to verify their identity. Specifically, DPS Licensing
Unit staff spend approximately 15 to 20 minutes with each appli-cant
reviewing the application for completeness, verbally verify-ing
the contents of the application, and ensuring the applicant
meets citizenship and age requirements. In addition, staff finger-
DPS’ current application
process requires 15 to 20
minutes of personal con-tact
with each applicant.
Finding III
24
OFFICE OF THE AUDITOR GENERAL
print and photograph the applicant, collect the applicable fees,
and manually prepare the appropriate certificate.
Besides being inefficient, the process is also inconvenient. It often
requires significant travel for applicants because DPS has only
two licensing locations in the State, Phoenix and Tucson.
DPS Should Streamline Its
Application Process
and Devote More Time
to Oversight Functions
DPS should follow the practices used by other states and in-crease
security guard and private investigator agencies’ respon-sibilities
in the employee application process. Streamlining the
application process for security guard and private investigator
employees could eliminate the need for additional staff without
lessening DPS’ regulatory role. In addition, DPS could also de-vote
more time to other regulatory processes such as conducting
compliance site inspections and complaint investigations.
DPS should streamline the employee application process—DPS
should revise its administrative rules and practices to allow secu-rity
guard and private investigators to submit applications by
mail. Specifically, applicants and the agencies they will be work-ing
for should be responsible for ensuring that the application is
complete and contains sufficient information to show that the
employee meets the minimum qualifications. In addition, agen-cies
should be responsible for ensuring that the employee obtains
a completed fingerprint card from a local law enforcement
agency and obtains two passport-size photos. This change in
process should not place any unnecessary burden on the agen-cies,
as the employee will have already provided much of the
required information, such as a social security card, valid identi-fication,
and felony background information, when seeking em-ployment.
The agency or applicant should then mail the com-pleted
application, fingerprint card, photos, and applicable fees
to DPS. DPS would then determine if all required information
DPS should allow appli-cations
to be submitted by
mail.
Finding III
25
OFFICE OF THE AUDITOR GENERAL
has been submitted and pass the information onto the DPS unit
that would conduct a criminal history background check on the
applicant.
Changing to a mail-in process for security guard and private in-vestigator
employee applications is consistent with practices in
other states such as Arkansas, California, Nevada, and Texas.
Further, auditors estimate that allowing agencies to submit em-ployee
applications by mail could reduce the time DPS spends
processing these applications at least in half, or to 10 minutes or
less.
Change in application process could provide additional bene-fits—
Streamlining the employee application process could also
provide other benefits. First, changing to a mail-in application
process could potentially eliminate the need for the 5 FTEs DPS
requested for fiscal year 2002. Although DPS’ request for addi-tional
FTEs was not granted, it should postpone future requests
until a mail-in process is implemented and DPS can assess how
this change impacts its workload. Second, this change would
also allow DPS to spend more time on other regulatory func-tions.
Because application review processing time may be cut in
half, DPS could increase its oversight role by having staff con-duct
more site compliance checks. These site visits involve travel-ing
to areas where employees are assigned and determining if
the employees are in compliance with requirements such as car-rying
their registration certificate, as well as ensuring that no un-certified
employees are working. DPS has also indicated that it
would like to dedicate more time to investigating complaints
and conducting proactive investigations. In DPS’ fiscal year 2002
budget request, it reported an inability to conduct proactive in-vestigations,
largely due to the increased number of applicants
and renewal applicants.
Mail-in application proc-ess
could eliminate need
for additional requested
FTEs.
Finding III
26
OFFICE OF THE AUDITOR GENERAL
Recommendations
1. To increase its efficiency, DPS should change to a primarily
mail-in application process for security guard and private in-vestigator
employees.
2. DPS should place a hold on future requests for additional
staff until it has revised its process and reassessed its staffing
needs.
3. DPS should use some of the resources freed by a more effi-cient
licensing process to enhance its oversight role by per-forming
tasks such as conducting regular site compliance vis-its
and responding to complaints.
27
OFFICE OF THE AUDITOR GENERAL
FINDING IV DPS COULD IMPROVE
ITS SECURITY GUARD
REGULATION PRACTICES
DPS could improve its regulation of security guards by making a
few changes that are consistent with practices in other states and
recommended by national associations. First, DPS should seek
legislative authority to amend its statutes to require security
guard applicants to receive training before they receive a tempo-rary
certificate. In addition, before issuing temporary certificates
and during the three-year certificate period, DPS should conduct
state background checks.
DPS Regulates
Security Guards
DPS’ Licensing Unit is responsible for regulating the security
guards employed by companies conducting business in Ari-zona.
1 Although security guards are not granted any law en-forcement
powers beyond those of an average citizen, it is the
philosophy of DPS, as well as national security and law en-forcement
organizations, that security guards are in positions of
trust and that untrained, unlicensed people are a potential threat
to public safety. To receive a security guard registration certifi-cate
the applicant must meet statutory qualifications, such as age
and criminal history requirements (see Item 2, page 28). In addi-tion,
applicants must be sponsored by a DPS-licensed security
guard agency.
1 Arizona does not regulate security personnel who are employed directly
by proprietary businesses.
Finding IV
28
OFFICE OF THE AUDITOR GENERAL
Item 2 Examples of Security Guard
Applicant Qualifications
U.S. citizen or legal resident
At least 18 years of age
No current felony charges
No convictions for crimes involving fraud, physical
violence, illegal sexual conduct, or the illegal use or
possession of a deadly weapon
No convictions for drug offenses or theft within the
past five years
Source: A.R.S. §32-2622(A).
DPS is statutorily authorized to issue the applicant a temporary
permit, known as a provisional certificate, which is good for six
months. During the six-month period, DPS completes a state
background check and sends the applicant’s fingerprints to
the FBI for a federal background check. If the applicant’s back-ground
check does not identify any disqualifying information,
the applicant receives a security guard certificate that is valid for
three years.
Lack of Training Requirements
and Regular Criminal History Checks
Impacts Effectiveness
DPS’ current regulation practices for security guards are not as
effective as they could be. Auditors noted the following prob-lems:
Lack of training—Provisional certificates are issued to appli-cants
allowing them to work before they receive training.
Applicants are currently required to complete training in
specific topic areas before receiving their three-year certifi-cate,
but not before receiving their provisional certificate. In
addition, the amount of training required for unarmed secu-rity
guards, such as a minimum number of hours, is not
specified in statute or rules. Finally, no continuing education
is required during the three-year certificate period.
Finding IV
29
OFFICE OF THE AUDITOR GENERAL
Lack of background checks—The provisional certificate is
also provided before any criminal history background checks
are completed. Although the federal check can take up to
three months to complete, generally, a state background
check can be completed in only a few days. However, even if
the state background check identifies potentially disqualify-ing
information, DPS does not always immediately act on the
information. For example, auditors reviewed 32 licensing
files and found that 16 provisional certificate holders had po-tentially
disqualifying information in their state criminal his-tory
records. For each of these cases DPS failed to immedi-ately
take action even though the state background check
identified arrest information for potentially disqualifying of-fenses,
such as assault. Instead, it appears that DPS waited for
the federal criminal history information to be returned, which
often took two to three months, before taking action.
Further, DPS does not conduct any state background checks
during the three-year period that the security guard is certi-fied.
For example, a registered security guard who was quali-fied
at the time of receiving his certificate was later convicted
of a sex offense. However, he continued to hold a valid secu-rity
guard certificate because DPS was unaware of his convic-tion.
DPS officials indicated that they believe that provisional certifi-cates
were statutorily authorized because the security guard
agencies often need to hire employees quickly to work at heavily
attended one-time events, such as sporting events.
DPS Should Enhance Its
Training and Background Check
Requirements for Security Guards
DPS should take the necessary steps to enhance its regulation of
security guards. Practices used by other states and recom-mended
by national associations, such as the National Associa-tion
of Security and Investigative Regulators (NASIR), are stricter
than Arizona’s. To better ensure that only qualified applicants
receive and retain security guard certificates, DPS should make
the following changes:
Provisional certificates are
provided before applicants
complete training or
background checks.
Finding IV
30
OFFICE OF THE AUDITOR GENERAL
Require upfront training—DPS should seek legislative au-thority
to amend Title 32, Chapter 26, to require security
guard applicants to receive training prior to receiving their
provisional certificate. The International Chiefs of Police, as
well as NASIR, developed best practice guidelines for the
regulation of security officers that indicate that training
should be completed before an application is submitted. The
guidelines state that training offers greater public protection
and can help law enforcement. For example, a security guard
can be trained in how to preserve a crime scene before police
officers arrive. California, Florida, New York, and Oregon re-quire
upfront training. In addition, DPS should specify in
statute the minimum amount of training unarmed security
guards should receive prior to obtaining their provisional
certificate.
Require ongoing training—DPS should also seek legislative
authority to amend Title 32, Chapter 26, to require continuing
education during the three-year licensure period. The Inter-national
Chiefs of Police, as well as NASIR, recommend con-tinuing
and/or annual in-service training. Several states, in-cluding
California, Florida, Nevada, Oregon, Tennessee,
Utah, and Virginia, have instituted mandatory in-service/
refresher training for armed and/or unarmed secu-rity
guard personnel.
Conduct state background checks—Before issuing provi-sional
certificates and during the certificate period, DPS
should conduct state background checks. These checks can
be completed fairly quickly and would offer greater assur-ance
that the security guard does not have a disqualifying
criminal record prior to receiving a provisional certificate and
while certified. A.R.S. §41-1713(A) and (B) was amended in
April 2000 to allow DPS to conduct state criminal history re-cords
checks to update and verify the status of security
guards. However, DPS has not yet implemented a mecha-nism
for conducting these background checks.
States such as California, Florida, and Texas have implemented
systems in which the licensing entity is listed as an interested
party with their state’s department of public safety and will be
automatically notified if a current license holder is convicted of a
DPS should require up-front
training and con-duct
background checks
before providing provi-sional
security guard cer-tificates.
Finding IV
31
OFFICE OF THE AUDITOR GENERAL
felony in their state. For example, if a security guard in Texas is
convicted of a crime, the Texas Commission on Private Security
is automatically notified. DPS could consider implementing a
similar action or, at a minimum, annually searching the State’s
criminal history information system for any potentially disquali-fying
information. To conduct initial state background checks on
security guard applicants, DPS may want to follow the process
used by its Concealed Weapon Permit program. Program staff
enter the applicant’s identifying information, such as name and
social security number, into a database that is searched against
the State’s criminal justice information system for disqualifying
information overnight, and produces a report on applicants with
potentially disqualifying information. DPS could also consider
seeking an additional $18,000 to $20,000 in funding to purchase a
fingerprint card imaging system. This system copies applicants’
and certificate holders’ fingerprints into the State’s automated
fingerprint information system and uses the fingerprints to
search for disqualifying information. The system can also be en-abled
to notify DPS when a certificate holder is arrested.
Study Committee
Established
During the 2001 legislative session, the Legislature established a
Private Investigator and Security Guard study committee. This
committee, consisting of legislative representatives, the Gover-nor,
the Director of DPS, and public members, is directed to ex-amine
issues relating to private investigators and security
guards, such as:
Standards for hiring and training;
Fees for licensure and registration; and
Problems and benefits of provisional certificates.
Because this report makes recommendations regarding security
guard training and provisional certificates, DPS should share this
report with the study committee.
Finding IV
32
OFFICE OF THE AUDITOR GENERAL
Recommendations
1. DPS should seek legislative authority to amend Title 32,
Chapter 26, to:
a. Require security guard applicants to receive training be-fore
they receive a provisional certificate;
b. Establish the minimum amount of training required; and,
c. Include continuing education requirements for security
guards.
2. DPS should complete state criminal history background
checks before it provides provisional security guard certifi-cates,
pursuant to the authority granted under A.R.S. §41-
1713.
3. DPS should complete state criminal history background
checks on security guards at least annually during the three-year
certificate period, pursuant to the authority granted un-der
A.R.S. §41-1713.
33
OFFICE OF THE AUDITOR GENERAL
OTHER PERTINENT INFORMATION
During the audit, other pertinent information was gathered re-garding
DPS’ operation of the Concealed Weapon Permit pro-gram.
DPS Operates the Concealed
Weapon Permit Program
The Concealed Weapon Permit program began in 1994 when
legislation was passed allowing Arizona residents to obtain con-cealed
weapon permits. DPS administers this program by issu-ing
permits to qualified individuals; approving the training or-ganizations
and instructors who provide the mandatory con-cealed
weapon permit training; and conducting investigations
and audits of permit holders, instructors, and training organiza-tions
to ensure compliance with state laws and rules.
Concealed weapon permits issued to qualified applicants—DPS
issues concealed weapon permits to qualified Arizona residents
or U.S. citizens. Prior to receiving a permit, an applicant must
undergo a state and national background check. Using informa-tion
contained on the application form and fingerprint card, DPS
searches criminal history databases for information that would
disqualify the applicant from receiving a permit, such as a felony
conviction. Permits are valid for four years and cost $50, which
Item 3 Concealed Weapon
Permit Requirements
Must be an Arizona resident or U.S. citizen
Must be at least 21 years of age
Not under indictment or convicted of a felony
Not suffer from mental illness or have been committed
Not unlawfully present in the U.S.
Satisfactorily completes a firearms safety-training program
Source: A.R.S. §13-3112.
DPS issues concealed
weapon permits to
Arizona residents or
U.S. citizens who
meet statutory re-quirements.
Other Pertinent Information
34
OFFICE OF THE AUDITOR GENERAL
includes $24 for the FBI background check. In addition, appli-cants
must provide documentation that they have completed a
firearms safety training course. The training course for initial ap-plicants
is 16 hours and provides an overview of legal issues in
the use of deadly force as well as instructions on weapon care
and maintenance, marksmanship, and mental conditioning for
the use of deadly force. Further, training participants are re-quired
to pass an exam that covers course material and show
proficiency on the firing range. Permit holders wishing to renew
their permits must undergo another background check and
complete a four-hour refresher course that covers recent changes
in Arizona’s gun laws. While statute affords DPS 75 days to issue
a permit, it typically takes only 10 to 20 days to complete the
application process and issue a permit.
During the program’s first year, fiscal year 1995, DPS issued
more than 27,500 permits. Since then, the number of permits is-sued
annually has declined significantly. However, beginning in
fiscal year 1999 the program’s workload increased, as DPS began
issuing renewal permits. Nonetheless, the overall number of ac-tive
permits has begun to stabilize, with approximately 61,000
active permits as of November 2000. Figure 3 (see page 35) illus-trates
the number of initial and renewal permits issued since the
program’s inception.
In addition to issuing permits, statute allows DPS to enter into
reciprocal agreements with other states that have concealed
weapons laws substantially similar to Arizona’s. These agree-ments
allow each state’s permit holders to carry concealed
weapons in either state, as long as they abide by that state’s gun
laws. Forty-three states allow individuals to carry concealed
weapons. Because Arizona’s laws governing concealed weapon
permits are generally more restrictive, Arizona has entered into
agreements with only five states: Alaska, Arkansas, Kentucky,
Texas, and Utah.
DPS has entered into re-ciprocal
agreements with
five other states.
Other Pertinent Information
35
OFFICE OF THE AUDITOR GENERAL
Instructor and training organization approval—DPS is also re-sponsible
for approving the instructors and organizations that
provide the required concealed weapon permit training courses.
The instructor must meet the requirements for obtaining a per-mit
and complete specific instruction from either the Arizona
Peace Officer Standards and Training Board or from the National
Rifle Association. Furthermore, as part of its application, a train-ing
organization must submit a lesson plan for DPS’ approval.
Statute requires that the training course address legal issues per-taining
to the use of deadly force, weapon care and maintenance,
mental conditioning for the use of deadly force, safe handling
and storage of weapons, marksmanship, and judgmental shoot-ing.
Upon reviewing the organization’s lesson plan, DPS will
conduct a site visit to address any identified problems and dis-cuss
the program’s expectations. As a means of keeping instruc-tors
up-to-date, DPS offers a workshop several times a year that
provides instructors information on any changes impacting the
concealed weapons laws, such as recent court rulings, and
changes in statutes or administrative rules.
Figure 3
Department of Public Safety
Licensing Bureau
Initial and Renewal Concealed Weapon Permits Issued Annually
Years Ended June 30, 1995 through 2000
27,505
14,560
9,876 7,997 8,910
14,371
10,165
7,251
0
5,000
10,000
15,000
20,000
25,000
30,000
Number of Permits
1995 1996 1997 1998 1999 2000
Year
Initial Permits Renewal Permits
Source: Auditor General staff analysis of information in the Department of Public Safety’s annual reports
for 1995 through 2000.
Other Pertinent Information
36
OFFICE OF THE AUDITOR GENERAL
Investigations and audits—DPS conducts various administra-tive
and criminal investigations to ensure permit holders, appli-cants,
instructors, and training organizations are in compliance
with state law and rules. Audits of instructors and training or-ganizations
entail announced visits by one of the two DPS-sworn
officers assigned to the program to ensure instructors comply
with statutory requirements and their established course outline.
DPS also investigates consumer complaints about instructors or
training organizations. Currently, DPS is pursuing legal action
against two instructors who allegedly falsified documents indi-cating
that participants completed the required training course
when they had not. Additionally, DPS is taking corrective action
against those permit holders who claimed to have attended the
training. Lastly, DPS performs ongoing monitoring of all permit
holders to ensure they remain qualified. Although an arresting
law enforcement agency is required to report an arrest of a per-mit
holder, this does not always happen. Therefore, the active list
of permit holders is regularly searched against the State’s auto-mated
criminal history database to determine if any active per-mit
holders have been arrested or convicted of an offense that
would disqualify them from holding a permit. If any disqualifi-ers
appear, DPS may either suspend or revoke the individual’s
permit.
DPS monitors permit
holders to ensure they
remain qualified.
OFFICE OF THE AUDITOR GENERAL
APPENDIX
OFFICE OF THE AUDITOR GENERAL
(This Page Intentionally Left Blank)
a-i
OFFICE OF THE AUDITOR GENERAL
APPENDIX
Department of Public Safety
Licensing Bureau
Databases Searched During
Firearms Background Checks
As of December 2000
Federal Databases—Accessible by the FBI and other state law
enforcement officials:
National Crime Information Center (NCIC), Wanted Person
File—Contains records on individuals with an outstanding
federal warrant or serious misdemeanor warrant; probation
and parole violators; juveniles tried as adults; juvenile es-capee,
probation, or parole absconder or those charged with
delinquency; temporary felony wanted persons where a war-rant
cannot immediately be obtained.
National Instant Criminal Background Check System—
Contains records on individuals who abuse controlled sub-stances,
are dishonorably discharged, or have renounced
their citizenship, and persons previously denied the purchase
of a firearm but for whom disqualifying data are not con-tained
in any other database file. Information is supplied by
states and federal agencies, such as the Department of Vet-eran’s
Affairs and the State Department.
Interstate Identification Index—Contains criminal history
records information such as name, physical description, iden-tifying
numbers, and fingerprint classifications. The name of
the agency that maintains that criminal history record is also
provided.
Appendix
a-ii
OFFICE OF THE AUDITOR GENERAL
Arizona State Databases—Accessible by DPS’ Firearms Clear-ance
Center:
Arizona Computerized Criminal History1—Contains Ari-zona
arrest information and disposition information on of-fenders.
Information is entered by the Arizona Department
of Public Safety, Criminal History Records Unit from finger-print
arrest cards and disposition reports.
Arizona Criminal Information Center, Computerized
Wanted Persons File2—Contains warrants held by Arizona
law enforcement agencies.
Offender-Based State Correction Information System—
Contains information provided by the Arizona Department
of Corrections on persons currently and previously in prison
or on parole.
Sex Offender Registration and Notification File—An index
of convicted sex offenders registered in Arizona.
1 Duplicates Arizona-based information in the Interstate Identification in-dex.
2 Records meeting NCIC criteria indicating out-of-state extradition are auto-matically
forwarded for entry into the Wanted Person File.
OFFICE OF THE AUDITOR GENERAL
Agency Response
OFFICE OF THE AUDITOR GENERAL
(This Page Intentionally Left Blank)
April 26, 2001
Ms. Debra K. Davenport, CPA
Auditor General, State of Arizona
Office of the Auditor General
2910 North 44th Street
Phoenix, Arizona 85018
Dear Ms. Davenport:
Enclosed is the Department's written response to the Auditor General’s draft report of the performance
audit of the Department of Public Safety Licensing bureau. Please do not hesitate to contact my office if you
have any questions.
Sincerely,
Dennis A. Garrett, Colonel
Director
lb
Enclosures
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
1
GENERAL
The Arizona Department of Public Safety, Licensing Bureau, recognizes that
audits and inspections provide a valuable means to evaluate Department
operations from an external source and make recommendations for
improvement. The following is in response to the information provided and
recommendations made.
FINDING I ARIZONA COULD SAVE
$650,000 ANNUALLY BY
ALLOWING FBI TO CONDUCT
BACKGROUND CHECKS
Recommendations
1. To save the State about $650,000 annually, the Legislature should
consider transferring the responsibility of conducting firearm background
checks to the FBI. The change would require repealing A.R.S. §13-3114
and coordination with the FBI.
Response
The finding of the Auditor General is not agreed to and the
recommendation will not be implemented.
In Arizona, if a juvenile is adjudicated delinquent, the person is prohibited
from possessing or using a firearm for 10 years from the date of
adjudication. The Department is working with Arizona Office of Courts
(AOC) to obtain access to the Juvenile On-Line Tracking System (JOLTS)
database. This database contains information supplied by county courts on
juveniles (ages 8-17) who are “referred” to the juvenile court for
delinquent acts. AOC is working on completing the programming
necessary to make JOLTS information available statewide on the Arizona
Criminal Justice Information System (ACJIS) network.
AOC is working on a statewide domestic violence data warehouse, which
will house orders of protection, injunctions work-place violence
injunctions and temporary orders of protection. The Department will
pursue access to this information to be shared statewide with users of the
ACJIS network. Currently orders of protection/injunctions meeting the
National Crime Information Center (NCIC) entry criteria may be entered
by law enforcement into NCIC Order of Protection Registry. However,
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
2
some orders of protection/injunctions do not meet the NCIC entry criteria
and access to that information is not electronically available to NICS.
Senate Bill 1108 will allow the Department to access confidential mental
health records to comply with statutes relating to purchase of weapons.
While this bill may not be successful this year due to funding issues, all
parties involved agree to the importance of this project and are working on
a plan to implement it. Access to these records for weapons transfer will
be available only to the Department.
The Department is working to comply with the Auditor General report
recommendations to improve the Firearms Clearance Center. Compliance
with these recommendations, coupled with the availability of additional
information will help the Department provide a superior service in
comparison to the FBI.
Moving the burden of providing this service to the FBI will save state
funding, but will still cost taxpayers at the federal level. The cost of the
program can be saved, if the legislature chooses to self-fund the unit
through fees.
2. If the Legislature decides that DPS should retain this responsibility, it
should consider providing DPS the statutory authority to recover its
operating costs by assessing a nominal fee.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
3. If the Legislature provides DPS the statutory authority to establish a fee, it
should also consider providing DPS with the authority to establish a
separate fund to account for the fees remitted to the program, and to be
used to cover the program’s operating expenditures.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
4. If the Legislature provides DPS the statutory authority to assess a fee for
performing background checks, DPS should develop policies and
procedures for collecting fees from licensed dealers.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Through Self-Funding,
DPS could develop a
model program while
saving the taxpayers
$650,000
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
3
FINDING II DPS SHOULD TAKE STEPS TO
ENSURE THAT ONLY ELIGIBLE
INDIVIDUALS CAN BUY GUNS
Recommendations
If the Legislature decides DPS should continue performing the background
check function:
1. DPS should continue to allocate some of its existing staff positions to
perform research as their primary responsibility on cases where DPS
cannot immediately determine whether a person is eligible to purchase a
gun.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
2. DPS should begin research cases immediately or as soon as practical on
cases that require additional research to determine whether an individual is
eligible to purchase a gun.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
3. DPS should use its files on previously denied cases to help it more
efficiently complete its research.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
4. DPS should make a change to its computer system so that it will
automatically notify staff when a prospective buyer was previously
denied.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
5. DPS should seek legislative authority to allow it to delay the sale of a
firearm from 3 to 30 days, and to indicate how it will resolve the cases that
it cannot determine eligibility for within 30 days.
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
4
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
6. DPS should develop procedures specifying a time frame for contacting
firearms dealers when research is complete, and documenting that the
contacts have been made.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
7. DPS should develop procedures for promptly notifying ATF when
information indicates that an ineligible individual was sold a gun.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
8. DPS should establish administrative rules for responding to delayed and
denied gun buyers’ inquiries and appeals.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
5
FINDING III DPS COULD STREAMLINE
ITS SECURITY GUARD AND
PRIVATE INVESTIGATOR
APPLICATION PROCESS
Recommendations
1. To increase its efficiency DPS should change to a primarily mail-in
application process for security guard and private investigator employees.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Concern
Funding to mail licenses to the agencies and applicants.
2. DPS should place a hold on future requests for additional staff until it has
revised its process and reassessed its staffing needs.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
3. DPS should use some of the resources freed by a more efficient licensing
process to enhance its oversight role performing tasks such as conducting
regular site compliance visits and responding to complaints.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Concerns
Increased site compliance visits may require additional travel (in-state).
Compensation would have to be reflected in the fiscal year budget.
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
6
FINDING IV DPS COULD IMPROVE
ITS SECURITY GUARD
REGULATION PRACTICES
Recommendations
1. DPS should seek legislative authority to amend Title 32, Chapter 26, to:
a. Require security guard applicants to receive training before they
receive a provisional certificate;
b. Establish the minimum amount of training required; and,
c. Include continuing education requirements for security guards.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Concerns
This recommendation places an increased burden on the industry. The
financial impact could be considerable for small agencies.
2. DPS should complete state criminal history background checks before it
provides provisional security guard certificates, pursuant to the authority
granted under A.R.S. §41-1713.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Concerns
This will increase the time for agencies to hire personnel and will impact
small agencies.
3. DPS should complete state criminal history background checks on security
guards at least annually during the three-year certificate period, pursuant
to the authority granted under A.R.S. §41-1713.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Other Performance Audit Reports Issued Within
the Last 12 Months
Future Performance Audit Reports
Arizona Commission on the Arts
State Board of Chiropractic Examiners
00-14 Arizona Department of Agriculture—
State Agricultural Laboratory
00-15 Arizona Department of Agriculture—
Commodity Development
00-16 Arizona Department of Agriculture—
Pesticide Compliance and Worker
Safety Program
00-17 Arizona Department of Agriculture—
Sunset Factors
00-18 Arizona State Boxing Commission
00-19 Department of Economic Security—
Division of Developmental
Disabilities
00-20 Arizona Department of Corrections—
Security Operations
00-20 Universities—Funding Study
00-21 Annual Evaluation—Arizona’s
Family Literacy Program
01-01 Department of Economic Security—
Child Support Enforcement
01-02 Department of Economic Security—
Healthy Families Program
01-03 Arizona Department of Public
Safety—Drug Abuse Resistance
Education (D.A.R.E.) Program
01-04 Arizona Department of
Corrections—Human Resources
Management
01-05 Arizona Department of Public
Safety—Telecommunications
Bureau
01-06 Board of Osteopathic Examiners in
Medicine and Surgery
01-07 Arizona Department
of Corrections—Support Services
01-08 Arizona Game and Fish Commission
and Department—Wildlife
Management Program
01-09 Arizona Game and Fish
Commission—Heritage Fund

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State of Arizona
Office
of the
Auditor General
PERFORMANCE AUDIT
LICENSING BUREAU
Report to the Arizona Legislature
By Debra K. Davenport
Auditor General
DEPARTMENT
OF
PUBLIC SAFETY
May 2001
Report No. 01-10
The Auditor General is appointed by the Joint Legislative Audit Committee, a bipartisan committee
composed of five senators and five representatives. Her mission is to provide independent and impar-tial
information and specific recommendations to improve the operations of state and local government
entities. To this end, she provides financial audits and accounting services to the state and political
subdivisions and performance audits of state agencies and the programs they administer.
The Joint Legislative Audit Committee
Senator Ken Bennett, Chairman
Representative Roberta L. Voss, Vice-Chairman
Senator Herb Guenther Representative Robert Blendu
Senator Dean Martin Representative Gabrielle Giffords
Senator Tom Smith Representative Barbara Leff
Senator Randall Gnant (ex-officio) Representative James Sedillo
Representative James Weiers (ex-officio)
Audit Staff
Dot Reinhard—Manager
and Contact Person (602) 553-0333
Paula Taylor—Team Leader
Rachel Rowland—Team Member
Heather Payne—Team Member
Copies of the Auditor General’s reports are free.
You may request them by contacting us at:
Office of the Auditor General
2910 N. 44th Street, Suite 410
Phoenix, AZ 85018
(602) 553-0333
Additionally, many of our reports can be found in electronic format at:
www.auditorgen.state.az.us
2910 NORTH 44th STREET • SUITE 410 • PHOENIX, ARIZONA 85018 • (602) 553-0333 • FAX (602) 553-0051
DEBRA K. DAVENPORT, CPA
AUDITOR GENERAL
STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL
WILLIAM THOMSON
DEPUTY AUDITOR GENERAL
May 15, 2001
Members of the Arizona Legislature
The Honorable Jane Dee Hull, Governor
Colonel Dennis Garrett, Director
Department of Public Safety
Transmitted herewith is a report of the Auditor General, A Performance Audit of the
Department of Public Safety’s Licensing Bureau. This report is in response to a June 16,
1999, resolution of the Joint Legislative Audit Committee. The performance audit was
conducted as part of the Sunset review set forth in A.R.S. §41-2951 et seq. I am also
transmitting with this report a copy of the Report Highlights for this audit to provide a
quick summary for your convenience.
This is the fifth in a series of reports to be issued on the Department of Public Safety.
As outlined in its response, the Department of Public Safety agrees with 17 of the 18
recommendations. The Department does not agree with the recommendation that the
Legislature should consider transferring the federally mandated firearm background
clearance check to the FBI. The Department indicates that it is working to obtain access
to additional sources of information, such as mental health records, that the FBI does
not have access to. The Department believes that if it gets access to this additional
information, it will be able to provide better background check services than the FBI.
My staff and I will be pleased to discuss or clarify items in the report.
This report will be released to the public on May 16, 2001.
Sincerely,
Debbie Davenport
Auditor General
Enclosure
OFFICE OF THE AUDITOR GENERAL
Program Fact Sheet
Department of Public Safety
Licensing Bureau
Concealed Firearms Licensing
Weapons Clearance Unit
Unit Unit
Facilities: The Licensing Bureau’s func-tions
are performed at the DPS Phoenix
office and an additional DPS location in
Tucson. These sites are state-owned.
Primary Program Revenue Sources:
(estimated fiscal year 2001)
$0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
Criminal Justice Enhancement Fund
General Fund
Permit, license, and registration fees
The Security Guard & Private Investigator Licensing Unit collects
fees which help offset the cost to the General Fund. In fiscal year
2001, DPS estimates that it will remit $361,700 in fees or about 89
percent of the amount of its General Fund appropriation for this
unit.
Hundred Thousands
Personnel: 35 (fiscal year 2001)
Concealed Weapon
Unit (7)
Administration (2)
Licensing
Unit (9)
Firearms Clearance
Center (17)
Services: This audit focuses on three of the Licensing Bureau’s four units: 1) Firearms Clear-ance
Center—performs background checks to determine the eligibility of individuals wishing
to purchase a firearm; 2) Security Guard and Private Investigator Licensing Unit—regulates
security guard and private investigator employees and the agencies that provide those ser-vices;
and 3) Concealed Weapon Permit Unit—issues concealed weapon permits to qualified
applicants, and licenses instructors and training organizations that provide the required train-ing.
Equipment: The Bureau uses six cars, which
are owned by DPS. These vehicles are pri-marily
used when conducting statewide
audits, investigations, and inspections asso-ciated
with the units’ regulatory functions.
Firearm
Clearance
Center
Security Guard &
Private Investigator
Licensing Unit
Concealed
Weapon
Permit Unit
OFFICE OF THE AUDITOR GENERAL
Goals and Performance Measures:
(fiscal years 2001—2003)
Goals: The Bureau has 3 goals and 11 per-formance
measures. The goals are:
1. To provide professional development
opportunities to employees and clients.
2. To improve efficiency and effectiveness
in administering mandated programs.
3. To improve customer service.
Adequacy of Goals and Performance
Measures:
The Licensing Bureau is a subprogram of the
Criminal Justice Support Division and there-fore
has relatively few performance meas-ures.
DPS has developed only two perform-ance
measures specific to the Bureau: per-centage
of employees offered training and
percentage increase in employee satisfaction.
Since the units within the Licensing Bureau
perform such unique functions, they have
developed a few additional individual per-formance
measures. However, more com-plete
measures are needed. These additional
performance measures should address each
unit’s specific responsibilities and should
include measures of input, output, outcomes,
efficiency, and quality. To assist in develop-ing
additional measures, DPS may want to
consider using the set of common inspection
and regulation performance measures out-lined
in the State’s Strategic Planning Guide-lines,
since the Licensing Bureau’s functions
are regulatory in nature.
i
OFFICE OF THE AUDITOR GENERAL
SUMMARY
The Office of the Auditor General has conducted a performance
audit of the Department of Public Safety’s Licensing Bureau as a
part of a Sunset review of the agency. This audit was conducted
pursuant to a June 16, 1999, resolution of the Joint Legislative
Audit Committee and was conducted under the authority vested
in the Auditor General by Arizona Revised Statutes (A.R.S.) §41-
2951 et seq. This is the fifth in a series of eight audits of the De-partment
of Public Safety.
The Department of Public Safety’s (DPS) Licensing Bureau is part
of the Criminal Justice Support Division, which provides regula-tory,
support, and other services essential to promoting public
safety in Arizona. This audit focuses on three of the Bureau’s four
programs: the Firearms Clearance Center, which determines an
individual’s eligibility to purchase a firearm; the Security Guard
and Private Investigator Licensing Unit, which regulates security
guard and private investigator agencies and employees; and the
Concealed Weapon Permit program, which issues permits to in-dividuals
qualified to carry concealed weapons in Arizona. The
fourth unit, Access Integrity, will be included in the audit of DPS’
Criminal Information Services Bureau.
Arizona Could Save $650,000 Annually by
Allowing FBI to Conduct Background Checks
(See pages 7 through 13)
The Legislature has the option of allowing the Federal Bureau of
Investigation (FBI) to perform the federally mandated firearm
background check function. The federal Brady Handgun Vio-lence
Prevention Act of 1994 requires that handgun, long gun,
and pawned gun purchasers undergo a background check to de-termine
whether they are legally allowed to buy a firearm. States
initially had to conduct these checks for the federal government,
but in November 1998, were given the option of transferring this
responsibility to the FBI. Currently, the FBI conducts all back-
The Legislature has the
option of transferring the
background check func-tion
to the FBI.
Summary
ii
OFFICE OF THE AUDITOR GENERAL
ground checks for 24 states and some of the background checks
for 11 other states. Arizona is 1 of only 15 states that have chosen
to retain the responsibility for conducting all background checks.
The Legislature should consider transferring the background
check function to the FBI. Having DPS conduct the checks pro-vides
few significant benefits beyond what the FBI can offer and
will cost the State about $650,000 in fiscal year 2001. Auditors de-termined
the FBI could provide effective background checks in
part by analyzing a random sample of purchases denied by DPS.1
In over 95 percent of these cases, the FBI would have had the in-formation
needed to deny a purchase. In most of the remaining
cases the denied individuals had active misdemeanor warrants,
and federal databases generally contain information on only fel-ony
warrants. While having an active warrant disqualifies an in-dividual
from purchasing a gun, the misdemeanor warrants in
these cases were for non-disqualifying offenses such as failure to
appear, or writing bad checks. In addition, the FBI more effec-tively
completes background checks on cases needing additional
research, a problem area for DPS’ program (see Finding II, pages
15 through 22). The FBI also offers more expanded hours than
Arizona, so transferring the background check function should
not inconvenience Arizona’s firearms dealers or gun buyers.
If the Legislature decides that DPS should retain the background
check function, it should consider providing DPS with the statu-tory
authority to charge fees to cover its operating costs. Cur-rently,
DPS primarily uses Criminal Justice Enhancement Fund
appropriations to pay for the program’s operating costs. How-ever,
most other states performing background checks charge a
fee to the licensed firearm dealer for each check, which typically
ranges from $5 to $15.
1 Auditors selected and analyzed 257 of approximately 7,400 purchases de-nied
by DPS since November 30, 1998.
FBI could offer effective
service.
Summary
iii
OFFICE OF THE AUDITOR GENERAL
DPS Should Take Steps to Ensure That
Only Eligible Individuals Can Buy Guns
(See pages 15 through 22)
If the Legislature decides that DPS should continue the back-ground
check function, DPS should take several steps to ensure
that guns are sold only to eligible persons. Although most back-ground
checks can be completed in minutes, some require addi-tional
research. For example, an individual’s criminal history re-cord
may list an arrest for a disqualifying offense such as bur-glary,
but the record does not indicate whether the person was
convicted. Therefore, to determine the individual’s eligibility to
purchase a firearm, DPS must contact a state or local criminal jus-tice
entity, such as a court, to obtain additional information.
In accordance with federal law, states are allowed a minimum of
three business days to conduct this research and DPS abides by
this standard. Therefore, dealers may sell the firearm after three
business days if DPS has not advised them that the individual is
ineligible to purchase a firearm. During calendar year 2000, DPS
was unable to complete background checks within the three-day
time frame for about 5,000 people, or 50 percent of the cases re-quiring
research. In these cases the dealer could legally sell the
weapon to the individual. However, it is unclear how many of
these individuals should have been prohibited from buying guns.
A review of nearly 200 such cases in which DPS did not complete
the background check for October 2000 found that more than
one-third of the individuals had arrests and/or charges on their
records for serious, disqualifying offenses, such as misconduct
with weapons, sexual assault, child abuse, and conspiracy to
commit murder.
Consistent with the intent of the law and practices in other states
that conduct their own background checks, DPS needs to make
several operational changes to ensure that ineligible individuals
are not allowed to buy guns. For example, DPS should follow the
practices of the FBI and other states by reassigning some of its ex-isting
staff to perform research as their primary function. In addi-tion,
DPS should also seek legislative authority that would allow
it to extend the sale of a firearm from 3 to 30 days. Other states
such as California, Georgia, and Tennessee have extended their
DPS was unable to com-plete
the background
checks for about 5,000
cases during calendar
year 2000.
Summary
iv
OFFICE OF THE AUDITOR GENERAL
research time frames and will not authorize the purchase of a gun
until the state confirms the buyer is eligible.
DPS Could Streamline Its Security Guard
and Private Investigator Application Process
(See pages 23 through 26)
By modifying its security guard and private investigator em-ployee
application practices, DPS could postpone its request for
additional staff and improve its oversight role. DPS staff currently
spend 15 to 20 minutes with each applicant reviewing their appli-cation
form with them. In addition, the application review proc-ess
is also inconvenient for applicants since DPS has only two li-censing
locations, Phoenix and Tucson, for the entire state.
DPS should revise its administrative rules and practices to allow
security guards and private investigators to submit applications
by mail. Specifically, applicants and the agencies they work for
could be responsible for obtaining a fingerprint card, and two
passport-sized photos, and ensuring that the application is com-plete
and contains sufficient information to show the applicant
meets the minimum qualifications. Once the application packet
was received, DPS would then determine if all the required in-formation
had been submitted and send the information to the
DPS unit conducting the criminal history background check on
the applicant. Auditors estimate that allowing security guards
and private investigators to submit applications by mail could
reduce DPS’ application review processing time at least in half, or
to ten minutes or less. This change could potentially postpone or
eliminate the need for additional staff and allow current staff to
dedicate more time to other regulatory functions, such as con-ducting
site compliance checks and investigating complaints.
DPS Could Improve Its Security
Guard Regulation Practices
(See pages 27 through 32)
DPS could improve its regulation of security guards by making a
few changes. To receive a security guard certificate, applicants
must meet statutory requirements, and be sponsored by a DPS-DPS
should change to a
mail-in application proc-ess.
Summary
v
OFFICE OF THE AUDITOR GENERAL
licensed security guard agency. Although security guards are not
granted any law enforcement powers beyond those of an average
citizen, it is the philosophy of DPS, as well as national security
and law enforcement organizations, that security guards are in
positions of trust and that untrained, unlicensed people are a po-tential
threat to public safety. However, many of the current li-censing
processes are not consistent with that philosophy. For
example, DPS issues a temporary permit, known as a provisional
certificate, that allows applicants to work for up to six months be-fore
they receive training, or their criminal history background
checks are complete. In addition, DPS does not conduct any fur-ther
background checks during the three-year period that the se-curity
guard is certified.
DPS should take the necessary steps to enhance its regulation of
security guards. Practices used by other states and recommended
by national security associations, such as the National Association
of Security and Investigative Regulators, are stricter than Ari-zona’s.
Consistent with other states and national associations,
DPS should:
Establish the type and amount of training required;
Require applicants to receive training prior to receiving their
provisional certificate;
Require continuing education during the certificate period;
Conduct state criminal history background checks before is-suing
a provisional certificate; and
Conduct additional background checks annually, during the
certificate period.
Some of these changes will require statutory revisions.
Other Pertinent Information
(See pages 33 through 36)
During the audit, other pertinent information was gathered re-garding
DPS’ Concealed Weapon Permit program, which began
in fiscal year 1995. DPS issues permits to qualified individuals,
DPS should conduct
regular state criminal
history background checks
on security guards.
Summary
vi
OFFICE OF THE AUDITOR GENERAL
approves the training organizations and instructors who provide
mandatory concealed weapon permit training, and conducts in-vestigations
or audits of permit holders, instructors, and training
organizations to ensure compliance with state concealed weapon
laws and rules. During the program’s first year, DPS issued over
27,500 permits. Further, as of the end of November 2000, 61,000
individuals had Arizona concealed weapon permits.
vii
OFFICE OF THE AUDITOR GENERAL
TABLE OF CONTENTS
Page
Introduction and Background........................... 1
Finding I: Arizona Could Save
$650,000 Annually byAllowing FBI
to Conduct Background Checks ................. 7
Individual States No Longer
Required to Perform the
Federally Mandated
Background Check................................................................. 7
Arizona’s Participation
Yields Few Benefits ................................................................ 9
If DPS Retains Function,
Fees Should Offset Operating Costs .................................. 12
Recommendations.................................................................. 13
Finding II: DPS Should Take Steps to
Ensure That Only Eligible
Individuals Can Buy Guns............................ 15
Incomplete Checks Increase
Risk to Public Safety............................................................... 15
Changes Are Needed to
Increase the Number of
Successfully Completed
Background Checks ............................................................... 18
Recommendations.................................................................. 22
Table of Contents
viii
OFFICE OF THE AUDITOR GENERAL
TABLE OF CONTENTS (Cont’d)
Page
Finding III: DPS Could Streamline
Its Security Guard and
Private Investigator
Application Process ...................................... 23
Security Guard and Private
Investigator Employee Application
Process Is Inefficient............................................................... 23
DPS Should Streamline Its
Application Process
and Devote More Time
to Oversight Functions.......................................................... 24
Recommendations.................................................................. 26
Finding IV: DPS Could Improve
Its Security Guard
Regulation Practices ..................................... 27
DPS Regulates
Security Guards....................................................................... 27
Lack of Training Requirements
and Regular Criminal History Checks
Impacts Effectiveness............................................................. 28
DPS Should Enhance Its
Training and Background Check
Requirements for Security Guards..................................... 29
Study Committee Established............................................. 31
Recommendations.................................................................. 32
Table of Contents
ix
OFFICE OF THE AUDITOR GENERAL
TABLE OF CONTENTS (Cont’d)
Page
Other Pertinent Information............................... 33
DPS Operates the Concealed
Weapon Permit Program...................................................... 33
Appendix.............................................................. a-i
Agency Response
Table
Table 1 Department of Public Safety
Licensing Bureau
Statement of Revenues, Expenditures,
and Changes in Fund Balance
Years Ended or Ending June 30, 2000
and 2001 (Unaudited)........................................ 3
Items
Item 1 Examples of Federal and State
Gun Purchaser Disqualifiers ........................... 8
Item 2 Examples of Security Guard
Applicant Qualifications................................... 28
Item 3 Concealed Weapon
Permit Requirements......................................... 33
Table of Contents
x
OFFICE OF THE AUDITOR GENERAL
TABLE OF CONTENTS (Concl’d)
Page
Figures
Figure 1 Department of Public Safety
Licensing Bureau
Results of Initial Firearm Background Check
Year Ended December 31, 2000
(Unaudited) ......................................................... 16
Figure 2 Department of Public Safety
Licensing Bureau
Results of Delayed Background Checks
Year Ended December 31, 2000
(Unaudited) ......................................................... 17
Figure 3 Department of Public Safety
Licensing Bureau
Initial and Renewal Concealed Weapon
Permits Issued Annually
Years Ended June 30, 1995
through 2000........................................................ 35
1
OFFICE OF THE AUDITOR GENERAL
INTRODUCTION AND BACKGROUND
The Office of the Auditor General has conducted a performance
audit of the Department of Public Safety’s Licensing Bureau as
part of a Sunset review of the agency. This audit was conducted
pursuant to a June 16, 1999, resolution of the Joint Legislative
Audit Committee. This audit was conducted under the authority
vested in the Auditor General by Arizona Revised Statutes
(A.R.S.) §41-2951 et seq. This is the fifth in a series of eight audits
of the Department of Public Safety.
Licensing Bureau Provides
Arizona with Various Licensing
and Regulatory Services
The Department of Public Safety’s (DPS) Licensing Bureau is
part of the Criminal Justice Support Division, which provides
regulatory, support, and other services essential to promoting
public safety in Arizona.1 This report focuses on three of the Li-censing
Bureau’s four programs: the Firearms Clearance Center;
Security Guard and Private Investigator Licensing Unit; and
Concealed Weapon Permit program.2 Each of the three units per-forms
a unique licensing or regulatory function and has distinct
funding sources (see Table 1, page 3).
Firearms Clearance Center (17 FTEs)—The Firearms
Clearance Center (Center) determines an individual’s eligibil-ity
to purchase a firearm by means of a national automated
1 The Division also includes the following other Bureaus: Criminal Informa-tion
Services, Fingerprint Identification, Information Technology, Opera-tional
Communications, Scientific Analysis, and Telecommunications.
2 The Bureau also includes the Access Integrity Unit, which is responsible
for training and auditing network users of the State’s automated criminal
justice information system, and will be incorporated into an Auditor Gen-eral
review of the Criminal Information Services Bureau.
Introduction and Background
2
OFFICE OF THE AUDITOR GENERAL
instant background check system. This national system was
established in federal law, which mandates that individuals
purchasing a firearm from a licensed firearms dealer must
undergo an instant background check. Similar to some states,
Arizona has chosen to perform these background checks on
behalf of the federal government, whereas the FBI performs
the background checks for nearly half of the states. Back-ground
checks involve searching state and national criminal
history databases, and other sources for information that
would disqualify the individual from purchasing a gun, such
as a felony conviction, active warrant, or misdemeanor con-viction
for domestic violence (see the Appendix, page a-i, for
a listing of the applicable databases). During calendar year
2000, the Center processed about 127,000 background checks
for Arizona’s firearms dealers. The Center’s estimated ex-penditures
for fiscal year 2001 are approximately $650,000,
with monies from the Criminal Justice Enhancement Fund
(CJEF) as its primary funding source.
Security Guard and Private Investigator Licensing Unit (9
FTEs)—The Security Guard and Private Investigator Licens-ing
Unit is responsible for regulating individual security
guards and private investigators, and the agencies that pro-vide
these services. Regulating agencies and individuals in-volves
determining each applicant’s eligibility and investigat-ing
suspected illegal behavior of either employees or agency
officials. At the end of fiscal year 2000, the unit reported that
there were 208 licensed security guard agencies and 12,593
certified security guards, and 1,242 private investigator agen-cies
and 2,143 private investigators. While the State’s General
Fund provides most of the unit’s revenue, monies collected
from application fees are remitted to the General Fund. The
unit’s estimated expenditures for fiscal year 2001 are ap-proximately
$415,000.
Concealed Weapon Permit Program (7 FTEs)—The Con-cealed
Weapon Permit Program is responsible for issuing
permits to individuals qualified to carry concealed weapons
in Arizona. In addition, it approves training instructors and
training organizations responsible for providing required
concealed weapon permit training. The unit also conducts
Table 1
Department of Public Safety
Licensing Bureau
Statement of Revenues, Expenditures, and Changes in Fund Balance1
Years Ended or Ending June 30, 2000 and 2001
(Unaudited)
Firearms Clearance Center
Security Guards and
Private Investigator
Licensing Unit
Concealed Weapon
Permit Program
2000
(Actual)
2001
(Estimated)
2000
(Actual)
2001
(Estimated)
2000
(Actual)
2001
(Estimated)
Revenues:
Appropriations:
State General Fund $ 2,100 $ 10,800 $420,000 $407,200 $ 2,300 $ 10,700
Criminal Justice Enhancement Fund 2 585,700 638,600
Arizona Highway Patrol Fund 3 6,100 9,500
Licenses and permits 361,700 361,700 453,070 330,000
Total revenues 587,800 649,400 787,800 778,400 455,370 340,700
Expenditures:
Personal services and employee related 481,203 543,800 392,200 395,400 400,852 370,000
Professional and outside services 275 2,800 2,600 6,615 4,800
Travel 1,290 1,400 1,300 1,000 2,262
Other operating and equipment 102,783 104,200 27,700 15,600 60,931 39,200
Total expenditures 585,551 649,400 424,000 414,600 470,660 414,000
Excess of revenues over (under) expenditures 2,249 363,800 363,800 (15,290) (73,300)
Other financing uses:
Reversion to the State General Fund 2,100 2,100
Reversion to the Criminal Justice Enhancement Fund 2,249
Remittance to the State General Fund 361,700 361,700
Total other financing uses 2,249 363,800 363,800
Excess of revenues over (under) expenditures and other uses (15,290) (73,300)
Fund balance, beginning of year 185,070 169,780
Fund balance, end of year $ 0 $ 0 $ 0 $ 0 $169,780 $ 96,480
1 The Bureau’s revenues and expenditures include an allocation of revenues and expenditures recorded in the Department’s Joint Account. The Joint Account contains State General Fund
appropriations and other appropriated monies, such as amounts from the Criminal Justice Enhancement Fund.
2 Consists of fines and forfeits deposited in the Criminal Justice Enhancement Fund (CJEF) and appropriated to the Department. Unexpended CJEF monies are presented as a reversion to CJEF
since any unexpended monies at year-end are subject to legislative appropriation in future years.
3 Appropriations to the Arizona Highway Patrol Fund consist of insurance premium taxes used to pay for eligible contributions to the Pubic Safety Personnel Retirement System.
Source: Auditor General staff analysis of information provided by the Department of Public Safety.
OFFICE OF THE AUDITOR GENERAL 3
Introduction and Background
Introduction and Background
4
OFFICE OF THE AUDITOR GENERAL
investigations into alleged misconduct of permit holders, ap-plicants,
instructors, and organizations. During fiscal year
2000, the program processed over 10,000 initial and 7,200 re-newal
permits, and at the end of November 2000 there were
over 61,000 active permit holders. Funding for the program is
derived from permit application fees, which are transferred
into a revolving fund. The program’s estimated expenditures
for fiscal year 2001 are approximately $518,000.
Audit Scope and
Methodology
Several methods were used to study the issues addressed in this
audit, including:
Firearms Clearance Center—Auditors reviewed national
literature on the development and implementation of the na-tional
instant criminal background check system (NICS); and
U.S. Code and Arizona statutes for gun requirements, includ-ing
those for purchasing and possessing firearms. To deter-mine
whether the FBI could provide comparable service,
auditors reviewed files from 257 of approximately 7,400 pur-chasers
denied by DPS since November 30, 1998, to identify
whether the FBI would have had access to the information
necessary to deny the purchase. Auditors also reviewed in-formation
on cases requiring additional research during Oc-tober
2000 to assess the Center’s research and documentation
efforts. Auditors contacted 10 of the 14 other states that per-form
all of their own background checks, and 4 of the 11
states that allow the FBI to conduct at least some of their
state’s background checks. States were contacted to deter-mine
how other states’ programs operate and to identify best
practices for performing and completing research. 1
1 Those states contacted that perform all their own background checks were
California, Colorado, Florida, Georgia, Illinois, Nevada, New Jersey, Penn-sylvania,
Tennessee, and Virginia. States contacted that have the FBI per-form
some of their background checks were Indiana, Maryland, Oregon,
and Wisconsin.
Introduction and Background
5
OFFICE OF THE AUDITOR GENERAL
Security Guard and Private Investigator Licensing Unit—
Auditors reviewed the unit’s policies and procedures, and
applicable statutes and administrative rules, which mandate
the licensing function. Auditors observed licensing processes
and conducted interviews with management and staff. Audi-tors
also reviewed agency documents that contained sum-mary
information on interviews conducted with security
guard agencies, to better understand issues within the indus-try.
Auditors analyzed best practices recommended by the
International Chiefs of Police and the National Association of
Security and Investigative Regulators (NASIR), and reviewed
summary information on state regulation practices for secu-rity
guard and private investigators compiled by the NASIR
in its State Licensing Information publication. Auditors also
researched licensing information from various state Web
sites, as well as contacted officials from seven states, to gain a
better understanding of how other states operate and obtain
information about best practices.1
Concealed Weapon Permit Program—Auditors reviewed
applicable statutes and administrative rules, and national lit-erature
that discusses the development of concealed weapon
programs. Additionally, auditors observed activities for issu-ing
permits, attended a training program DPS conducts for
instructors, and conducted interviews with management and
staff to become more familiar with the program’s operations.
This report presents findings and recommendations in four ar-eas:
The need for the Legislature to consider transferring the fire-arms
clearance function to the FBI;
The need for DPS to improve its ability to ensure that only
eligible individuals are allowed to buy guns;
The need for DPS to streamline its security guard and private
investigator employee application process; and
1 Licensing information was obtained from the following states’ Web sites:
Arkansas, California, Connecticut, Florida, Georgia, Illinois, Nevada, New
York, Oregon, Texas, and Utah.
Introduction and Background
6
OFFICE OF THE AUDITOR GENERAL
The need for DPS to improve its security guard regulation
practices.
Additionally, this audit presents other pertinent information on
the DPS’ Concealed Weapon Permit program and its functions.
This audit was conducted in accordance with government audit-ing
standards.
The Auditor General and staff express appreciation to the Direc-tor
and staff of the Department of Public Safety for their coopera-tion
and assistance during the audit.
7
OFFICE OF THE AUDITOR GENERAL
FINDING I ARIZONA COULD SAVE
$650,000 ANNUALLY BY
ALLOWING FBI TO CONDUCT
BACKGROUND CHECKS
The Legislature has the option of allowing the FBI to perform the
federally mandated firearms background check function. While
Arizona chose to retain this function in 1998, it yields few signifi-cant
benefits beyond what the FBI can provide and will cost the
State an estimated $650,000 for fiscal year 2001. Therefore, the
Legislature should consider transferring the background check
responsibility from DPS to the FBI. If the Legislature decides that
DPS should continue this function, it should consider providing
DPS with statutory authority to charge a fee so that it can recover
the cost for operating this federally mandated program.
Individual States No Longer
Required to Perform the
Federally Mandated
Background Check
The federal Brady Handgun Violence Prevention Act of 1994
(Brady Act) requires that individuals purchasing firearms from
licensed firearm dealers undergo a background check by means
of the national instant criminal background check system,
known as NICS.1 Initially, state or local governments were re-sponsible
for conducting their own background checks on hand-gun
purchases only. However, beginning on November 30, 1998,
the second phase of the Brady Act was implemented and back-ground
checks were also required on long gun and pawned gun
1 Although the Brady Act uses the term “transfer” of firearms, “sale” or
“purchase” are more common terms used to describe the exchange be-tween
dealer and buyer and are therefore the terms used in this report.
Finding I
8
OFFICE OF THE AUDITOR GENERAL
purchases. In addition, each state was also given the option of
continuing to perform the background checks, or allowing the
FBI to perform this function. Arizona chose to retain the respon-sibility
and DPS’ Firearms Clearance Center conducts the re-quired
check for individuals purchasing guns from federally li-censed
firearm dealers.1 Completing a background check in-volves
searching state and national criminal history databases,
and other sources for information that would disqualify the in-dividual
from purchasing a gun. Such disqualifiers include fel-ony
convictions, active warrants, or misdemeanor convictions for
domestic violence (see Item 1 above for a list of disqualifiers).
Disqualifiers are established in both federal and state law, and
Arizona’s mirror those set forth in the Brady Act in nearly every
respect.
People who want to purchase a gun from a licensed dealer must
complete a purchase request form that asks for identifying in-formation,
such as their name, address, date of birth, and social
security number.2 In addition, the form asks them to answer
1 Any business entity wishing to sell firearms must be licensed to do so by
the United States Bureau of Alcohol, Tobacco, and Firearms (ATF). There
are nearly 1,400 licensed firearms dealers in Arizona.
2 Department of the Treasury, Bureau of Alcohol, Tobacco and Firearms,
Firearms Transaction Record Part I—over-the-counter form ATF4473.
Item 1 Examples of Federal and State
Gun Purchaser Disqualifiers
Under indictment for or convicted of a felony
Fugitive from justice (active warrant)
Convicted of a misdemeanor crime of domestic violence
Subject to a court restraining order
Unlawful user or addicted to illegal drugs
Dishonorably discharged from the Armed Forces
Illegal alien, or has renounced U.S. citizenship.
Source: 18 U.S. Code §922 (d) and (g), and A.R.S. §31-3101.6 and
§31-3114(B)
Finding I
9
OFFICE OF THE AUDITOR GENERAL
other questions, such as whether they are currently under in-dictment,
are legally in the United States, or have ever been con-victed
of a felony. The dealer either calls or faxes DPS with the
identifying information and requests a background check. DPS
performed about 127,000 checks in calendar year 2000.
Arizona’s Participation
Yields Few Benefits
Having DPS perform the background check on Arizona gun
buyers does not yield any significant benefits, yet will cost the
State an estimated $650,000 in fiscal year 2001. It is unclear why
Arizona chose to retain this function. However, 24 states allow
the FBI to perform the entire background function for all firearm
purchases and auditors’ analysis suggests the FBI’s services
would be equally effective as DPS’ function. Therefore, the Legis-lature
should consider transferring the background check re-sponsibility
to the FBI. Transferring this function will require
statutory change and coordination with the federal government.
Arizona chose to perform its own background checks—Even
though states were given the option of transferring the back-ground
check responsibility to the FBI in November of 1998, Ari-zona
chose to retain this function. A review of legislative hearing
minutes during 1998 provides little clarification on why Arizona
decided to retain this function. However, there did appear to be
some confusion or uncertainty as to whether Arizona was re-quired
to continue performing this function. Further, appropria-tion
reports for fiscal years 1996 through 1999 contain language
suggesting that retaining this function at the state level would
eliminate the need for each of the 15 counties to individually de-velop,
fund, and operate its own background check programs.
These reports do not discuss the option of having the FBI take
over this responsibility for Arizona. Additionally, retaining the
responsibility was perceived as a convenience to Arizona’s li-censed
firearms dealers, as they were already familiar with the
process.
Twenty-four states have the FBI perform the entire background
check function—Twenty-four states have chosen to have the FBI
do all of their state’s background checks. In addition, 11 states
Conducting background
checks will cost $650,000
in fiscal year 2001.
Finding I
10
OFFICE OF THE AUDITOR GENERAL
have chosen to retain the background check responsibility for
handgun purchases only, but have the FBI perform the addi-tional
checks. Interviews with state officials suggest that they did
not take on the additional background check responsibilities be-cause
their state’s statutes were never changed and/or they did
not have the financial resources to complete the additional
checks required under the second phase of the Brady Act. Ari-zona
is 1 of only 15 states that have chosen to perform the back-ground
checks for all gun purchases.1
FBI could provide Arizona with effective service—The responsi-bility
for conducting background checks could be transferred to
the FBI without reducing effectiveness. In theory, states may de-sire
to complete their own background checks because they have
established stricter gun laws than those outlined in the Brady Act
or may have access to additional information not available to the
FBI.2 However, neither of these reasons appear to be important
factors in Arizona’s case.
To determine in part whether the FBI could provide comparable
service, auditors reviewed a random sample of 257 purchases
denied by DPS since November 30, 1998, to identify whether the
FBI would have had access to the information necessary to deny
the purchase. Among the 257 denied cases, auditors found only
12 cases in which the FBI may have approved the purchase. For
10 of these cases DPS denied the purchase because the individual
had an active misdemeanor warrant, which is a disqualifier. The
FBI may not have had this information because federal databases
generally contain information on only felony warrants. How-ever,
the active misdemeanor warrants for these cases were for
nondisqualifying offenses, meaning that once the warrants were
resolved, even if the individuals were convicted of the offenses,
they would not have been disqualified from purchasing a gun.
For example, the warrants were for misdemeanor charges such
1 Florida performs its own background checks on all firearm purchases, ex-cept
for certain pawned firearm transactions. For example, when a
pawned firearm is purchased back within 90 days, the broker may call ei-ther
the state or the FBI for a background check.
2 United States General Accounting Office (GAO), Report to Congressional
Requesters. Gun Control: Options For Improving the National Instant Criminal
Background Check System. Washington, D.C.: April 2000.
Many states allow the FBI
to conduct background
checks.
Finding I
11
OFFICE OF THE AUDITOR GENERAL
as failure to appear, writing bad checks, driving under the influ-ence,
and failure to pay a fine. The two remaining denied cases
included one misdemeanor conviction from ten years ago, which
is generally not contained on the federal databases, and one re-cent
felony arrest and charge which had not yet been transferred
to the federal databases.
In addition to providing comparable service on denied cases, the
FBI could probably provide better service in other areas. Specifi-cally,
the FBI more effectively completes background checks on
cases needing additional research by completing a higher per-centage
of checks within the minimum 3 days currently allowed
by federal law, and by extending its research beyond the 3 days
if necessary. Both of these are problem areas for DPS’ program
(see Finding II, pages 15 through 22, for additional information).
Transferring the background check function to the FBI should
also not inconvenience Arizona’s firearms dealers or gun buyers,
given that the FBI’s program offers more expanded hours than
Arizona, operating 17 hours a day, 7 days a week, except on
Thanksgiving and Christmas.1 Similar to the current process,
Arizona’s firearm dealers would use a toll-free number to phone
the FBI program.
Transferring this function will require repealing statute and co-ordinating
with the FBI— Transferring the background check
function from DPS to the FBI will require the Legislature to re-peal
the Firearms Clearance Center’s enabling statutes, A.R.S.
§13-3114. In addition, the State would need to coordinate the
transfer with the FBI. Although each state decides whether it will
conduct its own background checks, the FBI requests a 60-day
written notification from the states wishing to transfer the func-tion.
This allows the FBI time to prepare adequate staffing to
handle the increased workload, become familiar with the state’s
gun laws and program, and to communicate the change to fire-arm
dealers.
DPS should be involved in coordinating the transfer to ensure
that other DPS units are not unnecessarily impacted by the
1 DPS’ Firearms Clearance Center is open 7 days a week: 12 hours on week-days,
and 9 to 10 hours on weekends. It is closed on 6 holidays, and has
shortened hours on 6 other holidays.
Finding I
12
OFFICE OF THE AUDITOR GENERAL
change. Another unit in DPS also has some responsibility for re-searching
incomplete criminal history information for the FBI
now. Specifically, if the FBI is conducting a background check for
another state and finds incomplete Arizona criminal history in-formation,
it contacts DPS’ Criminal Information Services Bureau
because DPS serves as the central point of contact for missing
criminal history information. During a recent calendar year pe-riod,
the Bureau completed about 1,700 such research requests
for the FBI. DPS estimates that if the background check function
is transferred to the FBI, this bureau’s workload would increase
by about 5,000 requests and cost about $50,000 to complete. In
auditors’ discussions with the FBI, it indicated that the process it
uses to complete its research on Arizona criminal history infor-mation,
such as whether to have a central point of contact or use
local entities, could be discussed and changed if necessary.
If DPS Retains Function,
Fees Should Offset Operating Costs
If the Legislature decides to have DPS retain the background
check function, it should consider providing DPS the statutory
authority to charge fees. Most of the states that conduct their
own checks charge a fee to licensed firearm dealers to help offset
their program’s costs. For example, among the 15 states that per-form
the background check for all gun purchases, Arizona is 1 of
only 3 states that do not currently charge a fee.1 Additionally, 8
of the 11 states that perform handgun checks only charge a fee.
The fees charged typically range from $5 to $15 per background
check. DPS currently funds the background check function pri-marily
from its annual appropriated portion of Criminal Justice
Enhancement Fund (CJEF) monies. However, if DPS was author-ized
to charge a nominal fee, such as $5 to $10 per background
check, the fee revenue could cover Arizona’s annual program
cost.
Other states that charge fees have also established specific funds
for the fees collected by the program. Therefore, the Legislature
1 Colorado and Vermont are the other two states that do not charge a fee for
conducting background checks on their state’s firearm transactions.
Most states charge fees for
conducting background
checks.
Finding I
13
OFFICE OF THE AUDITOR GENERAL
should also consider providing DPS with statutory authority to
establish a separate fund to account for the fees remitted to the
program and to be used to cover the program’s annual operating
expenditures. If the Legislature provides DPS the statutory au-thority
to charge fees, DPS should establish policies and proce-dures
for collecting the fees from licensed firearm dealers.
Recommendations
1. To save the State about $650,000 annually, the Legislature
should consider transferring the responsibility of conducting
firearm background checks to the FBI. This change would re-quire
repealing A.R.S. §13-3114 and coordination with the
FBI.
2. If the Legislature decides that DPS should retain this respon-sibility,
it should consider providing DPS the statutory au-thority
to recover its operating costs by assessing a nominal
fee.
3. If the Legislature provides DPS the statutory authority to es-tablish
a fee, it should also consider providing DPS with the
authority to establish a separate fund to account for the fees
remitted to the program, and to be used to cover the pro-gram’s
operating expenditures.
4. If the Legislature provides DPS the statutory authority to as-sess
a fee for performing background checks, DPS should
develop policies and procedures for collecting fees from li-censed
firearm dealers.
14
OFFICE OF THE AUDITOR GENERAL
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15
OFFICE OF THE AUDITOR GENERAL
FINDING II DPS SHOULD TAKE STEPS TO
ENSURE THAT ONLY ELIGIBLE
INDIVIDUALS CAN BUY GUNS
If the Legislature decides that DPS should continue conducting
background checks, DPS should take several steps to ensure that
guns are sold only to persons who meet the law’s criteria. During
calendar year 2000, DPS was unable to effectively complete the
background search within the allotted time for about 5,000 cases.
Because the deadline could not be met, these people were able to
purchase guns without DPS determining their eligibility to do so.
Auditors’ review of nearly 200 such cases for October 2000
showed that more than one-third of the cases in which DPS did
not complete the background check involved people whose
criminal history records showed arrests or charges for disqualify-ing
offenses such as robbery, aggravated assault, or conspiracy to
commit murder. DPS needs to make several changes to its proc-esses
to better ensure that it completes all background checks so
that, consistent with the intent of the law, ineligible individuals
are not allowed to purchase guns.
Incomplete Checks Increase
Risk to Public Safety
DPS is not effectively completing all background checks within
the allotted time. Most background checks can be completed
quickly, but others require additional research to determine
whether the individual is allowed to purchase a gun. However,
during calendar year 2000, half of the cases that required addi-tional
research were not completed within the time allowed un-der
federal law. When DPS does not complete its research within
the allotted time, individuals who could have been disqualified
may be allowed to buy guns.
Half of the cases requiring research proceed by default—During
calendar year 2000, DPS did not complete the background check
within three business days for half of the cases that required re-search.
Most background checks can be completed in a
Finding II
16
OFFICE OF THE AUDITOR GENERAL
matter of minutes, but some require additional research. For ex-ample,
of the approximately 127,000 checks conducted during
calendar year 2000, 91 percent were immediately approved or
denied. However, for 8 percent of the background checks, DPS
had to delay the sale of the firearm to further research the indi-vidual’s
eligibility to purchase a gun (see Figure 1). The cases re-quiring
additional research are known as delayed cases.
It is important to research delayed cases because the individuals
who require research have information in their criminal history
record to suggest that they may be ineligible to purchase a gun.
For example, DPS needs to conduct research when an individ-ual’s
record lists one or more arrests for a disqualifying offense
but does not indicate whether the individual was convicted. Re-search
typically involves contacting a state or local entity, such as
a court, to obtain additional information. Pursuant to federal law,
a minimum of three business days is allowed to conduct this re-search
and DPS abides by these minimum standards. Therefore,
Figure 1
Department of Public Safety
Licensing Bureau
Results of Initial Firearm Background Check
Year Ended December 31, 2000
(Unaudited)
Immediate
denial
(3,194)
3%
Immediate
approval
(112,200)
88%
Delayed (10,095)
8%
Pending (1,391)
1%
a Cases result in a pending status when a computerized database is temporarily inac-cessible.
The background check is performed on these cases once the system be-comes
available.
Source: Auditor General staff analysis of daily background check statistics for 2000
provided by the Department of Public Safety.
a
Finding II
17
OFFICE OF THE AUDITOR GENERAL
dealers are allowed to sell the firearm after three business days if
they have not been advised by DPS that the individual is ineligi-ble.
These types of sales are known as default proceed cases.
During calendar year 2000, over 10,000 cases in Arizona required
additional research. However, DPS was unable to complete the
research within 3 business days for over 5,000 cases, or 50 percent
of the cases requiring research, and the dealer was legally allowed
to proceed with the sale (see Figure 2).
Ineligible individuals may be allowed to buy guns—When re-search
is not completed, ineligible people may be allowed to buy
guns. While it is unclear how many ineligible people in Arizona
have purchased guns, according to FBI research, among the cases
in which an individual’s arrest record may indicate potential dis-qualification
but research cannot be completed within 24 hours,
the individual is almost 20 times more likely to be an ineligible in-dividual
compared to transactions involving the average gun
buyer. In addition, auditors reviewed nearly 200 default proceed
cases for the month of October 2000 and found that more than
one-third of the prospective gun buyers had previously been ar-rested
and/or charged with serious disqualifying offenses, such as
misconduct with weapons, sexual assault, child abuse, arson, rob-bery,
aggravated assault, or conspiracy to commit murder.
Figure 2
Department of Public Safety
Licensing Bureau
Results of Delayed Background Checks
Year Ended December 31, 2000
(Unaudited)
Approved
(3,889)
39%
Denied (1,148)
11%
Proceed by
default (5,058)
50%
Source: Auditor General staff analysis of monthly delayed case research statistics for
2000 provided by the Department of Public Safety.
Finding II
18
OFFICE OF THE AUDITOR GENERAL
Changes Are Needed to
Increase the Number of
Successfully Completed
Background Checks
DPS needs to make operational changes to the background check
program to better ensure that ineligible individuals are not al-lowed
to buy guns. These changes should include reassigning
some staff to ensure research is completed on delayed cases, ini-tiating
research earlier, and seeking legislative authority to ex-tend
the research time for hard-to-resolve cases.
Increase the emphasis on research by reassigning some existing
staff—DPS could reduce the number of default proceed cases by
dedicating some existing staff to the crucial role of research. Until
March 2000, none of the 16 positions that perform background
checks were assigned the specific responsibility of conducting
research for delayed cases. Instead, they performed research only
as time permitted.1 Further, DPS’ policy requires that a mini-mum
of only one attempt be made to obtain additional informa-tion
on cases requiring research.
In contrast to Arizona’s operations, the FBI and other states place
greater emphasis on research by dedicating some staff to con-ducting
research. For example, 9 of the 14 states contacted dedi-cate
at least 2 FTEs to completing research. In addition to reas-signing
some staff, DPS should also revise its policies to require
more than one attempt to obtain additional information on cases
needing research.
Initiate research efforts earlier, while building on previous re-search
results—To improve its ability to complete background
checks within the three-day period, DPS should begin research
earlier and use the information from previously denied applica-tions.
Although there is nothing to preclude DPS from beginning
research immediately, it typically does not begin research on de-layed
cases until the following day, and sometimes not until
even the second or third business day. DPS could improve its
1 Effective March 2000, DPS established a procedure to assign two to three
staff a day to conduct research only.
DPS should reassign
some staff primarily to
conducting research on
delayed cases.
Finding II
19
OFFICE OF THE AUDITOR GENERAL
chances of confirming a buyer’s eligibility by instituting proce-dures
for initiating research as soon as practical following the
initial check.
As a first step in performing research, DPS should check its files
on previously disqualified individuals. Although DPS maintains
records on denied cases for a five-year period, it does not regu-larly
check this information when conducting research on a new
case. If the current buyer was previously disqualified, the infor-mation
in their file could provide some guidance as to why he or
she may need to be denied again. In addition, DPS may want to
make a change to its computer system so that it will automati-cally
alert staff when a prospective buyer was previously denied.
Although management requested this change in 1996, it has not
yet been made.
Extend the research time for those hard-to-resolve cases—DPS
should also seek legislative authority to extend the amount of
time it is allowed to research and confirm a gun buyer’s eligibil-ity.
Default proceed cases occur primarily because many states’
automated criminal history records do not show the dispositions
(acquittals or convictions) for arrests, and efforts to obtain such
information take longer than three business days. Although the
time frame for completing research is not addressed in Arizona
statute, DPS abides by the Brady Act’s minimum requirement of
three business days. However, several other states that conduct
their own background checks extend the research period or deny
purchases if they cannot readily determine eligibility. For exam-ple,
California, Georgia, and Tennessee will not authorize the
purchase of a gun until the state confirms the buyer is eligible,
regardless of how long it takes. Additionally, some states’ stat-utes,
such as Colorado, and Washington, allow them to deny an
individual when the individual’s criminal record contains a po-tentially
disqualifying charge, regardless of whether the state can
confirm that the individual was found guilty. Some examples of
how states ensure that only qualified individuals are sold guns
are noted below:
Colorado can deny a purchaser with an open disqualifying
arrest, such as a felony, even if the disposition cannot be ob-tained
within three days, thus eliminating the need for addi-tional
time to further research the transaction.
DPS should initiate re-search
efforts earlier.
Several other states delay
or deny purchases if eligi-bility
cannot be readily
determined.
Finding II
20
OFFICE OF THE AUDITOR GENERAL
Georgia’s regulations indicate that when a background
check identifies potentially disqualifying charges, the gun
dealer may not sell the firearm until being advised by the
state that the purchaser is not prohibited.
Washington state law allows up to five days to perform a
background check. However, if available records indicate the
prospective purchaser has an arrest for a potentially disquali-fying
offense, a hold for up to 30 days can be placed on the
transaction to allow the state additional time to verify the
purchaser’s eligibility. If additional time is needed beyond 30
days, an extension can be sought through a judicial order.
FBI data suggests that allowing more time to research delayed
checks would affect a relatively small portion (2 percent) of all
transactions, yet a 30-day extension could reduce the number of
default proceed cases by 77 percent. Furthermore, the U.S. De-partment
of Justice has stated it would support changing the
three-day requirement.
To ensure DPS can better meet the intent of the Brady Act and
complete all background checks on prospective gun buyers, DPS
should seek legislative authority to amend §13-3114 to allow it to
delay the sale of a firearm up to 30 days. Statutory changes
should also include direction on how DPS should handle cases
where the necessary information cannot be obtained within 30
days, such as whether the case would be denied on potentially
disqualifying information.
Improve procedures for proper interaction with licensed dealers,
ATF, and gun buyers—DPS should also enhance other written
procedures and provide staff proper instruction to better ensure
that appropriate actions are taken on delayed and denied trans-actions.
Specifically, DPS should develop or revise its procedures
for:
Ensuring prompt communication—DPS should develop
procedures for communicating in a timely manner informa-tion
on denied cases to licensed dealers. Although DPS’ pro-cedures
indicate that the dealer should be contacted, they do
Finding II
21
OFFICE OF THE AUDITOR GENERAL
not specify that the contact be documented, or specify a time-frame
for making the contact.
Notifying ATF immediately upon learning a disqualified
person obtained a gun—Currently there is no written pro-cedure
establishing a time frame for notifying the Bureau of
Alcohol, Tobacco, and Firearms (ATF) when a disqualified
person has been sold a gun. When DPS discovers that an in-eligible
person has been sold a firearm, DPS contacts ATF
and ATF then takes the steps necessary to retrieve the fire-arm.
The FBI’s procedure states it will notify ATF within six
to eight hours. However, a review of DPS’ 22 documented
contacts with ATF from December 1999 through October
2000 indicates that on at least one occasion DPS waited more
than three weeks before notifying the ATF that a disqualified
individual was sold a gun. In two other instances, DPS did
not notify ATF for one week or more.
Responding to gun buyer’s inquiries and appeals—DPS
should also develop administrative rules for handling inquir-ies
and appeals by gun buyers whose purchases are delayed
or denied. Statute allows DPS to adopt rules for establishing
an appeals process to inform denied gun buyers of the basis
for their denial. However, DPS has established only informal
guidelines for how it will respond to gun buyers’ inquiries.
More inquiries may occur if the Legislature grants DPS the
authority to extend the research time for hard-to-resolve
cases. Therefore, DPS should develop administrative rules
that outline the steps DPS will take, as well as what actions
the gun buyer has available.
Finding II
22
OFFICE OF THE AUDITOR GENERAL
Recommendations
If the Legislature decides DPS should continue performing the
background check function:
1. DPS should continue to allocate some of its existing staff po-sitions
to perform research as their primary responsibility on
cases where DPS cannot immediately determine whether a
person is eligible to purchase a gun.
2. DPS should begin research cases immediately or as soon as
practical on cases that require additional research to deter-mine
whether an individual is eligible to purchase a gun.
3. DPS should use its files on previously denied cases to help it
more efficiently complete its research.
4. DPS should make a change to its computer system so that it
will automatically notify staff when a prospective buyer was
previously denied.
5. DPS should seek legislative authority to allow it to delay the
sale of a firearm from 3 to 30 days, and to indicate how it will
resolve the cases that it cannot determine eligibility for within
30 days.
6. DPS should develop procedures specifying a time frame for
contacting firearms dealers when research is complete, and
documenting that the contacts have been made.
7. DPS should develop procedures for promptly notifying ATF
when information indicates that an ineligible individual was
sold a gun.
8. DPS should establish administrative rules for responding to
delayed and denied gun buyers’ inquiries and appeals.
23
OFFICE OF THE AUDITOR GENERAL
FINDING III DPS COULD STREAMLINE
ITS SECURITY GUARD AND
PRIVATE INVESTIGATOR
APPLICATION PROCESS
By modifying its security guard and private investigator em-ployee
application practices, DPS could reassess the need for ad-ditional
staff and enhance its oversight role for these professions.
DPS’ current practices are inefficient because they require per-sonal
contact with each applicant. DPS should change to a pri-marily
mail-in application process, and devote more time to
other regulatory functions, such as conducting compliance site
visits and investigating complaints.
Security Guard and Private
Investigator Employee Application
Process Is Inefficient
Some of DPS’ licensing processes are inefficient. During fiscal
year 2000, DPS processed over 11,000 security guard and 950
private investigator employee initial and renewal applications. In
addition, DPS processed 73 security guard agency and 526 pri-vate
investigator agency initial and renewal applications. DPS is
having difficulty meeting its workload demands. As a result, for
fiscal year 2002 DPS sought an additional 5 FTE at an annual cost
of over $114,000.
One key reason DPS is unable to meet its current workload de-mands
is because its application process for security guard and
private investigator employees is inefficient. Although not re-quired
in statute, DPS’ administrative rules stipulate that each
applicant must apply in person. DPS explains that this practice
enables it to obtain the applicant’s fingerprints, photos, and sig-nature,
and to verify their identity. Specifically, DPS Licensing
Unit staff spend approximately 15 to 20 minutes with each appli-cant
reviewing the application for completeness, verbally verify-ing
the contents of the application, and ensuring the applicant
meets citizenship and age requirements. In addition, staff finger-
DPS’ current application
process requires 15 to 20
minutes of personal con-tact
with each applicant.
Finding III
24
OFFICE OF THE AUDITOR GENERAL
print and photograph the applicant, collect the applicable fees,
and manually prepare the appropriate certificate.
Besides being inefficient, the process is also inconvenient. It often
requires significant travel for applicants because DPS has only
two licensing locations in the State, Phoenix and Tucson.
DPS Should Streamline Its
Application Process
and Devote More Time
to Oversight Functions
DPS should follow the practices used by other states and in-crease
security guard and private investigator agencies’ respon-sibilities
in the employee application process. Streamlining the
application process for security guard and private investigator
employees could eliminate the need for additional staff without
lessening DPS’ regulatory role. In addition, DPS could also de-vote
more time to other regulatory processes such as conducting
compliance site inspections and complaint investigations.
DPS should streamline the employee application process—DPS
should revise its administrative rules and practices to allow secu-rity
guard and private investigators to submit applications by
mail. Specifically, applicants and the agencies they will be work-ing
for should be responsible for ensuring that the application is
complete and contains sufficient information to show that the
employee meets the minimum qualifications. In addition, agen-cies
should be responsible for ensuring that the employee obtains
a completed fingerprint card from a local law enforcement
agency and obtains two passport-size photos. This change in
process should not place any unnecessary burden on the agen-cies,
as the employee will have already provided much of the
required information, such as a social security card, valid identi-fication,
and felony background information, when seeking em-ployment.
The agency or applicant should then mail the com-pleted
application, fingerprint card, photos, and applicable fees
to DPS. DPS would then determine if all required information
DPS should allow appli-cations
to be submitted by
mail.
Finding III
25
OFFICE OF THE AUDITOR GENERAL
has been submitted and pass the information onto the DPS unit
that would conduct a criminal history background check on the
applicant.
Changing to a mail-in process for security guard and private in-vestigator
employee applications is consistent with practices in
other states such as Arkansas, California, Nevada, and Texas.
Further, auditors estimate that allowing agencies to submit em-ployee
applications by mail could reduce the time DPS spends
processing these applications at least in half, or to 10 minutes or
less.
Change in application process could provide additional bene-fits—
Streamlining the employee application process could also
provide other benefits. First, changing to a mail-in application
process could potentially eliminate the need for the 5 FTEs DPS
requested for fiscal year 2002. Although DPS’ request for addi-tional
FTEs was not granted, it should postpone future requests
until a mail-in process is implemented and DPS can assess how
this change impacts its workload. Second, this change would
also allow DPS to spend more time on other regulatory func-tions.
Because application review processing time may be cut in
half, DPS could increase its oversight role by having staff con-duct
more site compliance checks. These site visits involve travel-ing
to areas where employees are assigned and determining if
the employees are in compliance with requirements such as car-rying
their registration certificate, as well as ensuring that no un-certified
employees are working. DPS has also indicated that it
would like to dedicate more time to investigating complaints
and conducting proactive investigations. In DPS’ fiscal year 2002
budget request, it reported an inability to conduct proactive in-vestigations,
largely due to the increased number of applicants
and renewal applicants.
Mail-in application proc-ess
could eliminate need
for additional requested
FTEs.
Finding III
26
OFFICE OF THE AUDITOR GENERAL
Recommendations
1. To increase its efficiency, DPS should change to a primarily
mail-in application process for security guard and private in-vestigator
employees.
2. DPS should place a hold on future requests for additional
staff until it has revised its process and reassessed its staffing
needs.
3. DPS should use some of the resources freed by a more effi-cient
licensing process to enhance its oversight role by per-forming
tasks such as conducting regular site compliance vis-its
and responding to complaints.
27
OFFICE OF THE AUDITOR GENERAL
FINDING IV DPS COULD IMPROVE
ITS SECURITY GUARD
REGULATION PRACTICES
DPS could improve its regulation of security guards by making a
few changes that are consistent with practices in other states and
recommended by national associations. First, DPS should seek
legislative authority to amend its statutes to require security
guard applicants to receive training before they receive a tempo-rary
certificate. In addition, before issuing temporary certificates
and during the three-year certificate period, DPS should conduct
state background checks.
DPS Regulates
Security Guards
DPS’ Licensing Unit is responsible for regulating the security
guards employed by companies conducting business in Ari-zona.
1 Although security guards are not granted any law en-forcement
powers beyond those of an average citizen, it is the
philosophy of DPS, as well as national security and law en-forcement
organizations, that security guards are in positions of
trust and that untrained, unlicensed people are a potential threat
to public safety. To receive a security guard registration certifi-cate
the applicant must meet statutory qualifications, such as age
and criminal history requirements (see Item 2, page 28). In addi-tion,
applicants must be sponsored by a DPS-licensed security
guard agency.
1 Arizona does not regulate security personnel who are employed directly
by proprietary businesses.
Finding IV
28
OFFICE OF THE AUDITOR GENERAL
Item 2 Examples of Security Guard
Applicant Qualifications
U.S. citizen or legal resident
At least 18 years of age
No current felony charges
No convictions for crimes involving fraud, physical
violence, illegal sexual conduct, or the illegal use or
possession of a deadly weapon
No convictions for drug offenses or theft within the
past five years
Source: A.R.S. §32-2622(A).
DPS is statutorily authorized to issue the applicant a temporary
permit, known as a provisional certificate, which is good for six
months. During the six-month period, DPS completes a state
background check and sends the applicant’s fingerprints to
the FBI for a federal background check. If the applicant’s back-ground
check does not identify any disqualifying information,
the applicant receives a security guard certificate that is valid for
three years.
Lack of Training Requirements
and Regular Criminal History Checks
Impacts Effectiveness
DPS’ current regulation practices for security guards are not as
effective as they could be. Auditors noted the following prob-lems:
Lack of training—Provisional certificates are issued to appli-cants
allowing them to work before they receive training.
Applicants are currently required to complete training in
specific topic areas before receiving their three-year certifi-cate,
but not before receiving their provisional certificate. In
addition, the amount of training required for unarmed secu-rity
guards, such as a minimum number of hours, is not
specified in statute or rules. Finally, no continuing education
is required during the three-year certificate period.
Finding IV
29
OFFICE OF THE AUDITOR GENERAL
Lack of background checks—The provisional certificate is
also provided before any criminal history background checks
are completed. Although the federal check can take up to
three months to complete, generally, a state background
check can be completed in only a few days. However, even if
the state background check identifies potentially disqualify-ing
information, DPS does not always immediately act on the
information. For example, auditors reviewed 32 licensing
files and found that 16 provisional certificate holders had po-tentially
disqualifying information in their state criminal his-tory
records. For each of these cases DPS failed to immedi-ately
take action even though the state background check
identified arrest information for potentially disqualifying of-fenses,
such as assault. Instead, it appears that DPS waited for
the federal criminal history information to be returned, which
often took two to three months, before taking action.
Further, DPS does not conduct any state background checks
during the three-year period that the security guard is certi-fied.
For example, a registered security guard who was quali-fied
at the time of receiving his certificate was later convicted
of a sex offense. However, he continued to hold a valid secu-rity
guard certificate because DPS was unaware of his convic-tion.
DPS officials indicated that they believe that provisional certifi-cates
were statutorily authorized because the security guard
agencies often need to hire employees quickly to work at heavily
attended one-time events, such as sporting events.
DPS Should Enhance Its
Training and Background Check
Requirements for Security Guards
DPS should take the necessary steps to enhance its regulation of
security guards. Practices used by other states and recom-mended
by national associations, such as the National Associa-tion
of Security and Investigative Regulators (NASIR), are stricter
than Arizona’s. To better ensure that only qualified applicants
receive and retain security guard certificates, DPS should make
the following changes:
Provisional certificates are
provided before applicants
complete training or
background checks.
Finding IV
30
OFFICE OF THE AUDITOR GENERAL
Require upfront training—DPS should seek legislative au-thority
to amend Title 32, Chapter 26, to require security
guard applicants to receive training prior to receiving their
provisional certificate. The International Chiefs of Police, as
well as NASIR, developed best practice guidelines for the
regulation of security officers that indicate that training
should be completed before an application is submitted. The
guidelines state that training offers greater public protection
and can help law enforcement. For example, a security guard
can be trained in how to preserve a crime scene before police
officers arrive. California, Florida, New York, and Oregon re-quire
upfront training. In addition, DPS should specify in
statute the minimum amount of training unarmed security
guards should receive prior to obtaining their provisional
certificate.
Require ongoing training—DPS should also seek legislative
authority to amend Title 32, Chapter 26, to require continuing
education during the three-year licensure period. The Inter-national
Chiefs of Police, as well as NASIR, recommend con-tinuing
and/or annual in-service training. Several states, in-cluding
California, Florida, Nevada, Oregon, Tennessee,
Utah, and Virginia, have instituted mandatory in-service/
refresher training for armed and/or unarmed secu-rity
guard personnel.
Conduct state background checks—Before issuing provi-sional
certificates and during the certificate period, DPS
should conduct state background checks. These checks can
be completed fairly quickly and would offer greater assur-ance
that the security guard does not have a disqualifying
criminal record prior to receiving a provisional certificate and
while certified. A.R.S. §41-1713(A) and (B) was amended in
April 2000 to allow DPS to conduct state criminal history re-cords
checks to update and verify the status of security
guards. However, DPS has not yet implemented a mecha-nism
for conducting these background checks.
States such as California, Florida, and Texas have implemented
systems in which the licensing entity is listed as an interested
party with their state’s department of public safety and will be
automatically notified if a current license holder is convicted of a
DPS should require up-front
training and con-duct
background checks
before providing provi-sional
security guard cer-tificates.
Finding IV
31
OFFICE OF THE AUDITOR GENERAL
felony in their state. For example, if a security guard in Texas is
convicted of a crime, the Texas Commission on Private Security
is automatically notified. DPS could consider implementing a
similar action or, at a minimum, annually searching the State’s
criminal history information system for any potentially disquali-fying
information. To conduct initial state background checks on
security guard applicants, DPS may want to follow the process
used by its Concealed Weapon Permit program. Program staff
enter the applicant’s identifying information, such as name and
social security number, into a database that is searched against
the State’s criminal justice information system for disqualifying
information overnight, and produces a report on applicants with
potentially disqualifying information. DPS could also consider
seeking an additional $18,000 to $20,000 in funding to purchase a
fingerprint card imaging system. This system copies applicants’
and certificate holders’ fingerprints into the State’s automated
fingerprint information system and uses the fingerprints to
search for disqualifying information. The system can also be en-abled
to notify DPS when a certificate holder is arrested.
Study Committee
Established
During the 2001 legislative session, the Legislature established a
Private Investigator and Security Guard study committee. This
committee, consisting of legislative representatives, the Gover-nor,
the Director of DPS, and public members, is directed to ex-amine
issues relating to private investigators and security
guards, such as:
Standards for hiring and training;
Fees for licensure and registration; and
Problems and benefits of provisional certificates.
Because this report makes recommendations regarding security
guard training and provisional certificates, DPS should share this
report with the study committee.
Finding IV
32
OFFICE OF THE AUDITOR GENERAL
Recommendations
1. DPS should seek legislative authority to amend Title 32,
Chapter 26, to:
a. Require security guard applicants to receive training be-fore
they receive a provisional certificate;
b. Establish the minimum amount of training required; and,
c. Include continuing education requirements for security
guards.
2. DPS should complete state criminal history background
checks before it provides provisional security guard certifi-cates,
pursuant to the authority granted under A.R.S. §41-
1713.
3. DPS should complete state criminal history background
checks on security guards at least annually during the three-year
certificate period, pursuant to the authority granted un-der
A.R.S. §41-1713.
33
OFFICE OF THE AUDITOR GENERAL
OTHER PERTINENT INFORMATION
During the audit, other pertinent information was gathered re-garding
DPS’ operation of the Concealed Weapon Permit pro-gram.
DPS Operates the Concealed
Weapon Permit Program
The Concealed Weapon Permit program began in 1994 when
legislation was passed allowing Arizona residents to obtain con-cealed
weapon permits. DPS administers this program by issu-ing
permits to qualified individuals; approving the training or-ganizations
and instructors who provide the mandatory con-cealed
weapon permit training; and conducting investigations
and audits of permit holders, instructors, and training organiza-tions
to ensure compliance with state laws and rules.
Concealed weapon permits issued to qualified applicants—DPS
issues concealed weapon permits to qualified Arizona residents
or U.S. citizens. Prior to receiving a permit, an applicant must
undergo a state and national background check. Using informa-tion
contained on the application form and fingerprint card, DPS
searches criminal history databases for information that would
disqualify the applicant from receiving a permit, such as a felony
conviction. Permits are valid for four years and cost $50, which
Item 3 Concealed Weapon
Permit Requirements
Must be an Arizona resident or U.S. citizen
Must be at least 21 years of age
Not under indictment or convicted of a felony
Not suffer from mental illness or have been committed
Not unlawfully present in the U.S.
Satisfactorily completes a firearms safety-training program
Source: A.R.S. §13-3112.
DPS issues concealed
weapon permits to
Arizona residents or
U.S. citizens who
meet statutory re-quirements.
Other Pertinent Information
34
OFFICE OF THE AUDITOR GENERAL
includes $24 for the FBI background check. In addition, appli-cants
must provide documentation that they have completed a
firearms safety training course. The training course for initial ap-plicants
is 16 hours and provides an overview of legal issues in
the use of deadly force as well as instructions on weapon care
and maintenance, marksmanship, and mental conditioning for
the use of deadly force. Further, training participants are re-quired
to pass an exam that covers course material and show
proficiency on the firing range. Permit holders wishing to renew
their permits must undergo another background check and
complete a four-hour refresher course that covers recent changes
in Arizona’s gun laws. While statute affords DPS 75 days to issue
a permit, it typically takes only 10 to 20 days to complete the
application process and issue a permit.
During the program’s first year, fiscal year 1995, DPS issued
more than 27,500 permits. Since then, the number of permits is-sued
annually has declined significantly. However, beginning in
fiscal year 1999 the program’s workload increased, as DPS began
issuing renewal permits. Nonetheless, the overall number of ac-tive
permits has begun to stabilize, with approximately 61,000
active permits as of November 2000. Figure 3 (see page 35) illus-trates
the number of initial and renewal permits issued since the
program’s inception.
In addition to issuing permits, statute allows DPS to enter into
reciprocal agreements with other states that have concealed
weapons laws substantially similar to Arizona’s. These agree-ments
allow each state’s permit holders to carry concealed
weapons in either state, as long as they abide by that state’s gun
laws. Forty-three states allow individuals to carry concealed
weapons. Because Arizona’s laws governing concealed weapon
permits are generally more restrictive, Arizona has entered into
agreements with only five states: Alaska, Arkansas, Kentucky,
Texas, and Utah.
DPS has entered into re-ciprocal
agreements with
five other states.
Other Pertinent Information
35
OFFICE OF THE AUDITOR GENERAL
Instructor and training organization approval—DPS is also re-sponsible
for approving the instructors and organizations that
provide the required concealed weapon permit training courses.
The instructor must meet the requirements for obtaining a per-mit
and complete specific instruction from either the Arizona
Peace Officer Standards and Training Board or from the National
Rifle Association. Furthermore, as part of its application, a train-ing
organization must submit a lesson plan for DPS’ approval.
Statute requires that the training course address legal issues per-taining
to the use of deadly force, weapon care and maintenance,
mental conditioning for the use of deadly force, safe handling
and storage of weapons, marksmanship, and judgmental shoot-ing.
Upon reviewing the organization’s lesson plan, DPS will
conduct a site visit to address any identified problems and dis-cuss
the program’s expectations. As a means of keeping instruc-tors
up-to-date, DPS offers a workshop several times a year that
provides instructors information on any changes impacting the
concealed weapons laws, such as recent court rulings, and
changes in statutes or administrative rules.
Figure 3
Department of Public Safety
Licensing Bureau
Initial and Renewal Concealed Weapon Permits Issued Annually
Years Ended June 30, 1995 through 2000
27,505
14,560
9,876 7,997 8,910
14,371
10,165
7,251
0
5,000
10,000
15,000
20,000
25,000
30,000
Number of Permits
1995 1996 1997 1998 1999 2000
Year
Initial Permits Renewal Permits
Source: Auditor General staff analysis of information in the Department of Public Safety’s annual reports
for 1995 through 2000.
Other Pertinent Information
36
OFFICE OF THE AUDITOR GENERAL
Investigations and audits—DPS conducts various administra-tive
and criminal investigations to ensure permit holders, appli-cants,
instructors, and training organizations are in compliance
with state law and rules. Audits of instructors and training or-ganizations
entail announced visits by one of the two DPS-sworn
officers assigned to the program to ensure instructors comply
with statutory requirements and their established course outline.
DPS also investigates consumer complaints about instructors or
training organizations. Currently, DPS is pursuing legal action
against two instructors who allegedly falsified documents indi-cating
that participants completed the required training course
when they had not. Additionally, DPS is taking corrective action
against those permit holders who claimed to have attended the
training. Lastly, DPS performs ongoing monitoring of all permit
holders to ensure they remain qualified. Although an arresting
law enforcement agency is required to report an arrest of a per-mit
holder, this does not always happen. Therefore, the active list
of permit holders is regularly searched against the State’s auto-mated
criminal history database to determine if any active per-mit
holders have been arrested or convicted of an offense that
would disqualify them from holding a permit. If any disqualifi-ers
appear, DPS may either suspend or revoke the individual’s
permit.
DPS monitors permit
holders to ensure they
remain qualified.
OFFICE OF THE AUDITOR GENERAL
APPENDIX
OFFICE OF THE AUDITOR GENERAL
(This Page Intentionally Left Blank)
a-i
OFFICE OF THE AUDITOR GENERAL
APPENDIX
Department of Public Safety
Licensing Bureau
Databases Searched During
Firearms Background Checks
As of December 2000
Federal Databases—Accessible by the FBI and other state law
enforcement officials:
National Crime Information Center (NCIC), Wanted Person
File—Contains records on individuals with an outstanding
federal warrant or serious misdemeanor warrant; probation
and parole violators; juveniles tried as adults; juvenile es-capee,
probation, or parole absconder or those charged with
delinquency; temporary felony wanted persons where a war-rant
cannot immediately be obtained.
National Instant Criminal Background Check System—
Contains records on individuals who abuse controlled sub-stances,
are dishonorably discharged, or have renounced
their citizenship, and persons previously denied the purchase
of a firearm but for whom disqualifying data are not con-tained
in any other database file. Information is supplied by
states and federal agencies, such as the Department of Vet-eran’s
Affairs and the State Department.
Interstate Identification Index—Contains criminal history
records information such as name, physical description, iden-tifying
numbers, and fingerprint classifications. The name of
the agency that maintains that criminal history record is also
provided.
Appendix
a-ii
OFFICE OF THE AUDITOR GENERAL
Arizona State Databases—Accessible by DPS’ Firearms Clear-ance
Center:
Arizona Computerized Criminal History1—Contains Ari-zona
arrest information and disposition information on of-fenders.
Information is entered by the Arizona Department
of Public Safety, Criminal History Records Unit from finger-print
arrest cards and disposition reports.
Arizona Criminal Information Center, Computerized
Wanted Persons File2—Contains warrants held by Arizona
law enforcement agencies.
Offender-Based State Correction Information System—
Contains information provided by the Arizona Department
of Corrections on persons currently and previously in prison
or on parole.
Sex Offender Registration and Notification File—An index
of convicted sex offenders registered in Arizona.
1 Duplicates Arizona-based information in the Interstate Identification in-dex.
2 Records meeting NCIC criteria indicating out-of-state extradition are auto-matically
forwarded for entry into the Wanted Person File.
OFFICE OF THE AUDITOR GENERAL
Agency Response
OFFICE OF THE AUDITOR GENERAL
(This Page Intentionally Left Blank)
April 26, 2001
Ms. Debra K. Davenport, CPA
Auditor General, State of Arizona
Office of the Auditor General
2910 North 44th Street
Phoenix, Arizona 85018
Dear Ms. Davenport:
Enclosed is the Department's written response to the Auditor General’s draft report of the performance
audit of the Department of Public Safety Licensing bureau. Please do not hesitate to contact my office if you
have any questions.
Sincerely,
Dennis A. Garrett, Colonel
Director
lb
Enclosures
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
1
GENERAL
The Arizona Department of Public Safety, Licensing Bureau, recognizes that
audits and inspections provide a valuable means to evaluate Department
operations from an external source and make recommendations for
improvement. The following is in response to the information provided and
recommendations made.
FINDING I ARIZONA COULD SAVE
$650,000 ANNUALLY BY
ALLOWING FBI TO CONDUCT
BACKGROUND CHECKS
Recommendations
1. To save the State about $650,000 annually, the Legislature should
consider transferring the responsibility of conducting firearm background
checks to the FBI. The change would require repealing A.R.S. §13-3114
and coordination with the FBI.
Response
The finding of the Auditor General is not agreed to and the
recommendation will not be implemented.
In Arizona, if a juvenile is adjudicated delinquent, the person is prohibited
from possessing or using a firearm for 10 years from the date of
adjudication. The Department is working with Arizona Office of Courts
(AOC) to obtain access to the Juvenile On-Line Tracking System (JOLTS)
database. This database contains information supplied by county courts on
juveniles (ages 8-17) who are “referred” to the juvenile court for
delinquent acts. AOC is working on completing the programming
necessary to make JOLTS information available statewide on the Arizona
Criminal Justice Information System (ACJIS) network.
AOC is working on a statewide domestic violence data warehouse, which
will house orders of protection, injunctions work-place violence
injunctions and temporary orders of protection. The Department will
pursue access to this information to be shared statewide with users of the
ACJIS network. Currently orders of protection/injunctions meeting the
National Crime Information Center (NCIC) entry criteria may be entered
by law enforcement into NCIC Order of Protection Registry. However,
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
2
some orders of protection/injunctions do not meet the NCIC entry criteria
and access to that information is not electronically available to NICS.
Senate Bill 1108 will allow the Department to access confidential mental
health records to comply with statutes relating to purchase of weapons.
While this bill may not be successful this year due to funding issues, all
parties involved agree to the importance of this project and are working on
a plan to implement it. Access to these records for weapons transfer will
be available only to the Department.
The Department is working to comply with the Auditor General report
recommendations to improve the Firearms Clearance Center. Compliance
with these recommendations, coupled with the availability of additional
information will help the Department provide a superior service in
comparison to the FBI.
Moving the burden of providing this service to the FBI will save state
funding, but will still cost taxpayers at the federal level. The cost of the
program can be saved, if the legislature chooses to self-fund the unit
through fees.
2. If the Legislature decides that DPS should retain this responsibility, it
should consider providing DPS the statutory authority to recover its
operating costs by assessing a nominal fee.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
3. If the Legislature provides DPS the statutory authority to establish a fee, it
should also consider providing DPS with the authority to establish a
separate fund to account for the fees remitted to the program, and to be
used to cover the program’s operating expenditures.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
4. If the Legislature provides DPS the statutory authority to assess a fee for
performing background checks, DPS should develop policies and
procedures for collecting fees from licensed dealers.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Through Self-Funding,
DPS could develop a
model program while
saving the taxpayers
$650,000
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
3
FINDING II DPS SHOULD TAKE STEPS TO
ENSURE THAT ONLY ELIGIBLE
INDIVIDUALS CAN BUY GUNS
Recommendations
If the Legislature decides DPS should continue performing the background
check function:
1. DPS should continue to allocate some of its existing staff positions to
perform research as their primary responsibility on cases where DPS
cannot immediately determine whether a person is eligible to purchase a
gun.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
2. DPS should begin research cases immediately or as soon as practical on
cases that require additional research to determine whether an individual is
eligible to purchase a gun.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
3. DPS should use its files on previously denied cases to help it more
efficiently complete its research.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
4. DPS should make a change to its computer system so that it will
automatically notify staff when a prospective buyer was previously
denied.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
5. DPS should seek legislative authority to allow it to delay the sale of a
firearm from 3 to 30 days, and to indicate how it will resolve the cases that
it cannot determine eligibility for within 30 days.
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
4
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
6. DPS should develop procedures specifying a time frame for contacting
firearms dealers when research is complete, and documenting that the
contacts have been made.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
7. DPS should develop procedures for promptly notifying ATF when
information indicates that an ineligible individual was sold a gun.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
8. DPS should establish administrative rules for responding to delayed and
denied gun buyers’ inquiries and appeals.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
5
FINDING III DPS COULD STREAMLINE
ITS SECURITY GUARD AND
PRIVATE INVESTIGATOR
APPLICATION PROCESS
Recommendations
1. To increase its efficiency DPS should change to a primarily mail-in
application process for security guard and private investigator employees.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Concern
Funding to mail licenses to the agencies and applicants.
2. DPS should place a hold on future requests for additional staff until it has
revised its process and reassessed its staffing needs.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
3. DPS should use some of the resources freed by a more efficient licensing
process to enhance its oversight role performing tasks such as conducting
regular site compliance visits and responding to complaints.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Concerns
Increased site compliance visits may require additional travel (in-state).
Compensation would have to be reflected in the fiscal year budget.
Response to Auditor General’s Report on the Licensing Bureau
ARIZONA DEPARTMENT OF PUBLIC SAFETY
6
FINDING IV DPS COULD IMPROVE
ITS SECURITY GUARD
REGULATION PRACTICES
Recommendations
1. DPS should seek legislative authority to amend Title 32, Chapter 26, to:
a. Require security guard applicants to receive training before they
receive a provisional certificate;
b. Establish the minimum amount of training required; and,
c. Include continuing education requirements for security guards.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Concerns
This recommendation places an increased burden on the industry. The
financial impact could be considerable for small agencies.
2. DPS should complete state criminal history background checks before it
provides provisional security guard certificates, pursuant to the authority
granted under A.R.S. §41-1713.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Concerns
This will increase the time for agencies to hire personnel and will impact
small agencies.
3. DPS should complete state criminal history background checks on security
guards at least annually during the three-year certificate period, pursuant
to the authority granted under A.R.S. §41-1713.
Response
The finding of the Auditor General is agreed to and the audit
recommendation will be implemented.
Other Performance Audit Reports Issued Within
the Last 12 Months
Future Performance Audit Reports
Arizona Commission on the Arts
State Board of Chiropractic Examiners
00-14 Arizona Department of Agriculture—
State Agricultural Laboratory
00-15 Arizona Department of Agriculture—
Commodity Development
00-16 Arizona Department of Agriculture—
Pesticide Compliance and Worker
Safety Program
00-17 Arizona Department of Agriculture—
Sunset Factors
00-18 Arizona State Boxing Commission
00-19 Department of Economic Security—
Division of Developmental
Disabilities
00-20 Arizona Department of Corrections—
Security Operations
00-20 Universities—Funding Study
00-21 Annual Evaluation—Arizona’s
Family Literacy Program
01-01 Department of Economic Security—
Child Support Enforcement
01-02 Department of Economic Security—
Healthy Families Program
01-03 Arizona Department of Public
Safety—Drug Abuse Resistance
Education (D.A.R.E.) Program
01-04 Arizona Department of
Corrections—Human Resources
Management
01-05 Arizona Department of Public
Safety—Telecommunications
Bureau
01-06 Board of Osteopathic Examiners in
Medicine and Surgery
01-07 Arizona Department
of Corrections—Support Services
01-08 Arizona Game and Fish Commission
and Department—Wildlife
Management Program
01-09 Arizona Game and Fish
Commission—Heritage Fund